Reply #17: It gets far worse than that. [View All]

As the article indicates the majority of taxpayer money in GM is equity = stock not bonds. At least with a bond if GM remains profitable eventually taxpayers will be paid back. The equity stake will NEVER be worth what "we" paid for it.

Taxpayers gave GM $42.8 billion for a 60.8% stake in GM.

In order for those shares to be sold and taxpayer break even (0% return) that would require GM to be worth about $70.4.

If the company hypothetically at some point in the future was worth $70.4 the govt could sell their shares (this assumes selling 60.8% of company wouldn't lower value of company) and their govt shares would be worth $42.8 billion.

So how likely is that?

To put that into perspective:
Ford is worth $43 billion.
Honda is worth $63 billion
Toyota is worth $124 billion

GM would need to be worth to private investors about double what Ford is now, more than Honda and about 75% of what Toyota is.