GM decides to “invest” in Europe

We learned today that Government Motors has decided to invest $335 million in a fabulously successful European auto maker.  Mercedes, Audi, BMW you guess?  Guess again.

Peugeot.

Yes, that would be the innovative automaker that has become a household word in all countries of the world.

But, you say, doesn’t GM still owe us taxpayers lots of money, and, by the by, where is GM getting the money?

Yes, GM still owes us lots of money, but, has chosen to “invest” rather than pay some of that money back.

And, GM has boat loads of money.  This is because of the GM “bankruptcy” which upended the rules of bankruptcy. GM was allowed to carry its losses before bankruptcy into the “new” GM, and, can use those losses to offset gains after bankruptcy.  This is unprecedented in bankruptcy law.  But the net effect of it is that GM, which the President proudly proclaimed is generating record profits, is paying little if any income taxes.

Mr. Obama crowed yesterday about GM’s “highest profits in its 100-year history.” We’d be interested to hear how its effective tax rate compares with Warren Buffett’s secretary’s.

Yes, where is Warren Buffet’s secretary when we need her?

 

8 replies
  1. essneff
    essneff says:

    Unfreaking believable?!!?Investment in?Peugeot!!! I have not seen a Peugeot in the last 25 years!!?Perhaps,?GM could ressurect the Yugo brand?& invest in that, a hybrid or electric powered?Yugo of course!!!??

    • JBS
      JBS says:

      Know why you don’t see Peugeots in the US? They are impossible to work on and there are no new parts to be had, no dealership could work with the French and the cars were/are, ahem, not very good.

  2. Plainvillian
    Plainvillian says:

    Two flailing, failing government owned companies combining?? What could possibly go wrong?

  3. Murphy
    Murphy says:

    Peugeot – (pronounced push s_it) had to leave the US and several other countries due to POOR QUALITY. Look around you’ll see more Pinto’s that Peugot’s

  4. JBS
    JBS says:

    Doesn’t GM owe the US Treasury some $30 billion? How about paying debts before spreading money around Europe?

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