GM details plans to wipe out current shareholders [securities fraud]

The Globe and Mail / Reuters ^ | May 5, 2009 | Kevin Krolicki

[Anti-Bubba182]

What this insures is that no one will buy a share of GM stock or loan them a dime. The United States has nationalized them.

[Freedom Dignity n Honor]

And yesterday I read where the FDIC wants .20 cents per $100 of deposits from all banks. The experts were estimating that about 4,000 of the 8,000 banks nationwide will go under or be taken over. This would be many of the smaller banks that aren't big enough or haven't taken TARP money.

Our banks were supposedly secure until this came up. This is a major attack on our economic system...dare I say a major terroristic attack by our own Pres and his admin, IMO?

[ridesthemiles]

I just don’t understand how this is even legal. I’m just speechless. Obama’s audacity has literally taken my breath away.””

Has anybody here at FR done any research as to what pensions own GM or Chrysler stock?

I think lots of pension & 401 K money is in those 2 companies, and the hammer it will create to millions of people is going to rings bells for a long time to come.

Anybody know the answers to my question?

[2ndDivisionVet]

I buy most of my parts at O’Reilly’s, of all places, and they aren’t expensive.

[Cacique]

the Nazis did. Obama is just following his game plan. We still have over 50% of the population blindly following the messiah.

[Squantos]

So don’t be stupid and repost it. Abuse button is yer friend. Now we have to remove your post to !

[timestax]

bttt

[April Lexington]

According to this formula, existing shareholders get diluted into oblivion but they continue to hold their shares. The new ocean of shares are issued primarily to the FedGov and the UAW. Then, they do a massive reverse split to bring the share value to a reasonable $18.00 or so per share. The old share holders get one new share for every 100 to 200 shares they hold, so they get squat (but, that's what owning a poorly run company does to equity). This is actually a pretty slick deal, except for the FedGov and the UAW ending up owning a majority of the company with voting control. It remains to be seen if the UAW VEBA and the FedGov continue to hold the majority and screw the company into the ground or, if the share price recovers with new capitalization, they sell their stock for a profit, diversify (especially the VEBA) and let control slip back into the private market where capitalism and freedom are restored. I guess we'll just have to trust Obama! (AND I DON'T TRUST THAT COMMUNIST FOR A STINKIN MINUTE!!!!!)

[April Lexington]

Pension funds owned lots of Gm and Chrysler. Blue chip a while back. The difference is they didn't own a controlling interest in the company and they had no board representation. Here. the UAW and the FedGov will actually control the board and they can elect pinko greenie management that will undoubtedly turn GM into the Birkenstock of automobile companies. Chrysler... operating assets now owned by Fiat (berlesconi & Co.) who are capitalists. Chrysler is safe for now...

[April Lexington]

If they can avoid bankruptcy, the bond holders may have a slight chance of getting most of their money back as the bonds mature. Equity is getting killed here; but... it should. They hired the management that tanked the company so they deserve to get wiped out. That's equity's job. This is a slick deal, except for the FedGov and the UAW taking control of the board. Disaster in the making...

[Gabrial]

This is part of Obama’s wealth redistribution plan.

Next Obama will dictate to GM what cars to build. They will be noncompetitive hybrids and electrics. To make people buy them, Obama will offer large tax rebates for the purchase of these “greener” vehicles. The 45% of people paying taxes will be stuck with the bill for funding the tax “rebates” to the 55% that don't pay taxes.

[Windflier]

I think lots of pension & 401 K money is in those 2 companies, and the hammer it will create to millions of people is going to rings bells for a long time to come.

There was a thread on here yesterday where some market-wise people were discussing the nuts and bolts of GM's reverse stock split and what that would mean to the stockholders.

From what I got, the small shareholders will get squeezed out by this move, but the large funds and larger investors will still hold a stake in the company (or whatever remains of it).

The criminal thing in all of this, is that Obama has engineered it so that the American taxpayers have essentially bought a majority stake in GM, which the government is now turning over a portion to the UAW.

I still cannot see how this is in any way legal. I also can't understand why more people around the country aren't raising the roof about it.

As far as I can see, it's grand theft auto on an industrial scale.

[Candor7]

This is just the first daylight robbery of many IMO.>>>>>>>>>>> This is war against the investment class on behalf of the so called 80 bucks an hour blue color workers.

I saw it coming, and divested myself of equities of US businesses subject to government takeover.

And it will get worse.Traders bear that in mind

[NeoCaveman]

I don’t even recognize this country anymore.

Welcome to Zimgeneula.

[kara2008]

How is this legal? Isn't this against SEC regulations and the fifth amendment?!! HOW is this possible from a legal standpoint? Anyone?

This is TOTAL insanity. We are officially a communist country. Where is the outrage?

Our beautiful country is gone and this is only the beginning. I fear for the future. How does one survive in a communist country with such an evil, vile leader and the thief infested congress?

[El Gato]

Bye, bye Mrs. American Pie. Gonna have to drive my Fiat to the levy now.

What other large carmakers are there out there that could possibly be "awarded" GM? Even Fiat has to be pretty full after swallowing Chryler. Hmm???

You might need to drive your Volkswagon to the levy, or maybe your Yugo? Or worse, and yet more likely one of these, or some combination thereof:

Here's your new Cherry, just the thing to drive to the levee.

Forgot about any hanky panky inside the vehicle once you get there though, unless you are a Chinese acrobat.

[El Gato]

Who is going to buy the new stock?

Chinese Oligarchs.

[El Gato]

The standard plan of tyrants: (1) nationalize the banks (2) nationalize the auto industry if your nation has one (3) round up your political enemies and eliminate them (4) seize control of the food production.

You left out a very necessary step, especially in an "armed to the eyeballs" country like the US.

Grab the Guns!

Probably somewhere between your (1) and (3).

[El Gato]

If that’s the case, I guess it won’t be long until we’re all forced to buy Chevy Yugo Hybrids...

More likely Chevy Cherry Hybrids.

Cherry is a Chinese car company, they even already sell cars in the US, alhtough I've not seen one, or talked to anyone who has.

[2ndDivisionVet]

I’ve lived in Mississippi and Texas with mine, so I haven’t had much experience with cold weather situations w/a diesel.