Closing Out the Auto Follies? Hope, but no Change

The Obama administration admitted that the auto bailout will cost taxpayers $14 billion. Of course, that's if you believe their accounting. Judging by prior statements on the repayment of loans, I rather doubt it. Additionally, the slide in car sales this month, may cause this loss to increase. Dean previously posted:

So, if you are scoring at home you have a) a bankruptcy cramdown where unions were shoved to the head of the line before secured creditors, b) a pack of blatant public lies regarding the payback of the TARP loan, c) a $9 billion loss on the first IPO last November and now this... a massive stock dump in order to clear the books ahead of the 2012 presidential elections.

Of course, it was all worth it, for the jobs, according to the administration. Never mind that other car companies would have probably scarfed up assets and workers or that a normal bankruptcy could have resulted in a healthier GM than the one that emerged from this bankruptcy.

In other economic news, consumer confidence is dropping, factories had their biggest one-month slow down since 1984, and the most recent jobs report showed only 38,000 jobs were created in May.


Consumer confidence graph from the Atlantic. If the economy is in recovery, we should see increasing consumer sentiment, which is clearly not the case.