Obviously this promise has already been broken multiple times, but now the Obama administration is interfering with GM's attempt to go back to private ownership. Public and partially publicly owned companies earn less money than privately owned ones. If you want to increase the stock price, sell off all the company right now. Selling off small portions of the company will maintain government control and will not raise the price. This piece in the NY Times tows
the Obama administration line on all this. Saying that the sale was being done to get "higher fees for the bankers" sure sounds like Obama administration class warfare rhetoric.
The initial public stock offering by General Motors will be smaller than previously suggested, and the federal government will most likely sell a relatively small portion of its 61 percent stake in the company, according to people with knowledge of the preparations.
To fetch the highest possible price for the government, G.M. is planning an overall offering of stock valued at $8 billion to $10 billion, which is lower than previous internal targets, according to the people, who spoke on the condition of anonymity because of restrictions on public comments before an offering.
Earlier, there were suggestions the stock offering could rival the largest in United States history, when the credit card giant Visa raised more than $19 billion in 2008. G.M. and its bankers had been pushing for the largest possible offering because that would mean higher fees for the bankers and a larger pool of investors for G.M.
But the Treasury Department has made it clear to G.M. and its underwriters that the government is more interested in setting the highest price possible for the stock rather than maximizing the size of the offering. While both G.M. and the Treasury still hope to reduce the government’s stake in the company to less than 50 percent and rid the company of its Government Motors nickname, that goal may not be met, one of the people said. . . .
Labels: bailout, brokenpromisesobama, GM