More news from the nightmare that is GMAC:WSJ: GMAC Asks for Fresh Lifeline
Really. It Just. Never. Ends.
At least now I understand why the goldbug investors think the way they do.
And remember, folks: I noted back in April that the brainiacs at GMAC ramped up subprime auto lending again. FICO of 600? Sure! Let us put you in a new car!
Cash for Clunkers? You betcha! GMAC was feeding at the trough on that one, too.
Seriously: When is enough ... enough?
The U.S. government is likely to inject $2.8 billion to $5.6 billion of capital into the Detroit company, on top of the $12.5 billion that GMAC has received since December 2008, these people said. The latest infusion would come in the form of preferred stock. The government's 35.4% stake in the company could increase if existing shares eventually are converted into common equity.
And as the article above notes, the FDIC's on the hook for GMAC, too. It's backing $4.5 billion of GMAC debt from earlier this year ... and is about to back another $2.9 billion of issued debt for this pathetic excuse for a company. (Good thing the FDIC is already in the red. At least this way, they sort of know how GMAC feels.)
These days, all roads truly do lead to the taxpayer.
No wonder fiat currencies have such a fabulous track record.
Labels: Automobiles, Bailouts, Banking
