GM WILL BECOME LARGEST CHINESE CAR COMPANY WITH NO EUROPEAN PRESENCE THANKS TO US GOVERNMENT MEDDLING-GOOD MOVE OR DISASTER?

Did anyone expect a different outcome given that the auto industry group of consultants that the administration sent to work on the GM (Government Motors) deal had never run any auto companies?

Their plan is to build "green" cars powered by THEIR PLAN IS TO BUILD "GREEN" CARS POWERED BY electricity that they do not want the electric companies to produce, nor are these cars that the vast majority of consumers want to buy; safety, cost and utility being the biggest reasons of why not.

As a result of the "great deal" worked out to "save" General Motors, there will be a total wipe out of present stockholders who saw hundreds of billions in stock losses on their stock which will now be "owned" by the US Government (who is that exactly?) and the UAW union and a little sliver owned by existing SUPER SECURED BOND holders who were threatened with various government intervention if they did not agree.

About $5-$8 billion of the bond holders were mostly regular folks who bought the bods for their "safety" as a secured instrument and for their yields so that they may retire, for instance.

Now thanks to government "help", they will be wiped out as secured creditors who had every right to get their full cash, and instead will receive some sliver of common stock ownership in the new mostly Chinese, GM.

There will also be no GM Europe, the other place that GM should be selling cars if it is to be a global player, but that will be sold.

The unsecured UAW members will get more than they will!

There is a revised wage deal for the UAW members, but it did nothing to reduce the wages and costs to GM, so what is the point of all this monkey business?

As to how effective will be the government "help", try to remember the last $80 billion that it spent to rebuild New Orleans!

Now they are spending an even more enormous sum of unrestricted TAXPAYER funds while shafting secured holders, the little people who held GM bonds.

I would not want to buy the new stock of GM, if for no other reason than to demonstrate its illegitimacy as a ethical corporation. But then again it is run by the ethical folks in Washington.

UPDATE:
Magna 'agrees to buy GM Europe'
Magna must still get German government clearance for the deal

Canadian-Austrian car parts maker Magna International has reached an agreement in principle to rescue GM Europe, owner of Opel and Vauxhall, reports say.

The agreement was reached with General Motors, but will need to be approved by the German government, which will be providing funding to the new owner.

The other potential bidder, Fiat, said it would not be attending Friday's talks with the German government.

GM in the US is expected to declare Chapter 11 bankruptcy on Monday.

There is due to be a meeting in Berlin at 1800 local time (1600 GMT) attended by Chancellor Angela Merkel, the ministers involved and officials from the German states that contain GM plants to discuss whether to approve the deal.

Extra funding

Magna and GM will not be attending the meeting at first, although they may be invited later.

There have been suggestions in the German media that it may be cheaper for the German government to allow GM Europe to declare itself insolvent than to allow it to be bought.

On Thursday, the German government criticised the US Treasury and General Motors after being told at the last minute that GM Europe would need another 300m euros ($415m; £260m) in short-term funding.

It has already offered almost 1.4bn euros in loan guarantees.

Magna and GM will also have to make sure that GM Europe is restructured in a way that will protect the carmaker if, as expected, its parent company in the US declares itself bankrupt which it is expected to file on Monday.

General Motors Corp. fell below $1, the minimum price normally needed to trade on the New York Stock Exchange, as the automaker headed for bankruptcy.

The world’s largest automaker until its 77-year reign ended in 2008 plans to file for Chapter 11 protection on June 1 and sell most of its assets to a new company, according to people familiar with the matter.