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Mercury C557
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is GM about to pay the politico piper?

Harry Wilson's Money Grab - WardsAuto
by John McElroy

Mar 2, 2015

Uh-oh, here we go again. If there is one lesson we learned from the Great Recession it’s to beware of financial wizards promoting get-rich-quick schemes. And now we find General Motors at the center of yet another such scheme.

This one involves Harry Wilson, one of the key figures in the Obama Admin.’s Automotive Task Force that oversaw the bankruptcies of GM and Chrysler in 2009. Harry is nominating himself to the GM board, all with the idea of getting the company to cough up $8 billion to buy back stock with the dream of driving up the price. It might be laughable except that Wilson has the backing of four giant investment funds that own millions of shares. So he could have the votes to get on the board.

By the way, he’ll get a big, fat commission from the investment funds based on how much money he can shake out of GM. So don’t get the idea he’s doing this to protect the pensioners and widows who own GM stock...

...Telling an automaker it holds too much cash is like telling an army going to war it has too much ammunition. If GM had this kind of war chest six years ago, it never would have gone bankrupt. Importantly, the Volkswagen Group has $6 billion more in cash than GM. Toyota has $11 billion more. They will use that money to out-invest GM in new products and new technology, pulling farther ahead of the car company that once was the largest in the world...

...Board members have a fiduciary responsibility, not just to shareholders, but to the corporate entity itself, which involves all the stakeholders. Singling out shareholders for a big payday is not being fair or responsible. The “old GM” spent billions buying back shares and kept doing so almost until it went bankrupt. Look how well that worked.

The confounding part of this ordeal is that Wilson helped figure out how to pour $50 billion of taxpayer money into saving GM, only to turn around and help his Wall Street pals get their mitts on a good chunk of that...

...Let’s hope the GM board never lets this happen.


John McElroy is editorial director of Blue Sky Productions and producer of the “Autoline” PBS television show and “Autoline Daily,” the online video newscast

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and noted by JFM on Mark Phelan's fb:
"
Apple has nearly $200 billion."
 
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