When GM needs to borrow money?

[GROUCHO MARX]

What happens when GM needs to borrow money now that they've come out of bankruptcy?

Eventually, they'll need to borrow to get their pension funding up to snuff and pay their retiree medical expenses.

After the way the bondholders were treated in the bankruptcy proceedings, will anyone go down that road again?

 

[Steve S]

Yes the road will be well traveled.
People are buying G.M. products.

 

[JHZR2]

If there is a return to be had, they will get takers. Otherwise they will increase the interest.

 

[Brett Miller]

Barry O. will lend them the $$$.

 

[rshaw125]

If Wikileaks exposes the truth behind the GM bailout who knows what interest rate they'll have to pay.

 

[GMBoy]

Originally Posted By: Steve S
Yes the road will be well traveled.
People are buying G.M. products.


x2

 

[ls1mike]

People are buying their stuff and I lost some money on the deal.
I had stock in the company that I bought with my re-enlistment bonus. I will get over it. I believe in their product and continue to buy it, as it seems the rest of America is doing, not like some of the naysayers here.

 

[LS2JSTS]

They already borrow money on the commercial credit level...on a daily basis. As do most large corporations, especially those who have captive financial arms that lend to consumers on the retail level.

FWIW, the pension plans are way ahead of the former stock/bond holders. True they are far behind on total obligation, but continued cash revenues should cover that future debt, as evidenced by recent payments. The UAW/VEBA and their almost 20% stake in the company is worth billions, on top of that they have warrants to purchase further shares at a sharp discount. If that weren't enough, GM has continued to make large cash payments into the UAW pension funds. They just made another cash payment of 4 Billion the other day....

http://www.freep.com/article/20101202/BU...o-pension-plans

"General Motors says it has made a $4 billion cash payment to its pension plans.

The company said in October that it would pay $6 billion to the plans, with $4 billion in cash and $2 billion worth of common stock.

GM says today's payment went to the U.S. pension plans. The automaker put $1.3 billion into the salaried plan and $2.7 billion into the hourly plan.

At the end of last year the U.S. pension funds were $17.1 billion short of their obligations. Their value will be measured again at the end of this year."

 

[Propflux01]

Originally Posted By: ls1mike
......I believe in their product and continue to buy it, as it seems the rest of America is doing, not like some of the naysayers here.
Some people have a blind faith as well. Maybe those naysayers don't..

 

[ls1mike]

Not blind faith last months/quaters numbers were pretty good.
While some others were down. Take a look at Toyotas numbers last month.

 

[GROUCHO MARX]

I saw that most U.S. sales are for light trucks. Isn't this where the problem started, rising fuel costs and products that didn't reflect consumer demand?

Maybe Americans just want their SUV's irrespective of what fuel costs are.

 

[defektes]

Originally Posted By: Tim H.
Originally Posted By: ls1mike
......I believe in their product and continue to buy it, as it seems the rest of America is doing, not like some of the naysayers here.
Some people have a blind faith as well. Maybe those naysayers don't..


As one of those naysayers and a what used to be a GM fan, I will never buy one out of principle untill all stock is out of government hands. I never thought I'd do it but my next car is gonna be a ford.

 

[GMBoy]

Originally Posted By: ls1mike
People are buying their stuff and I lost some money on the deal.
I had stock in the company that I bought with my re-enlistment bonus. I will get over it. I believe in their product and continue to buy it, as it seems the rest of America is doing, not like some of the naysayers here.


As a GM employee, I also lost a lot of stock (out of my 401K). I appreciate your dedication to both our country and to GM.

 

[BMWTurboDzl]

Originally Posted By: GROUCHO MARX

After the way the bondholders were treated in the bankruptcy proceedings, will anyone go down that road again?


Great point. I don't think joe public knows how bad hit it was to his/her pension. Some state pensions were big time bondholders and they got nadda.

 

[wapacz]

Originally Posted By: BMWTurboDzl
Originally Posted By: GROUCHO MARX

After the way the bondholders were treated in the bankruptcy proceedings, will anyone go down that road again?


Great point. I don't think joe public knows how bad hit it was to his/her pension. Some state pensions were big time bondholders and they got nadda.



No competent pension planner should have had any, let alone a large amount in gm bonds. The bonds had been down rate to c and junk well before they went through with bankruptcy.