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Signs stand in front of the General Motors world headquarters in Detroit, Michigan. The U.S. Treasury will sell its remaining stake in the company over the next year or so.
The day has finally arrived. The U.S. Treasury will sell off its stake in General Motors, the automaker that, along with Chrysler, was bailed out in 2009 before it declared bankruptcy and returned to the public markets via a massive $20 billion IPO in 2010.
The government put $50 million into GM and has gotten back about $30 billion. That figure includes a pre-loaded GM buyback of 200 million of its own shares from the Treasury at $27.50 a pop, a modest premium on Tuesday's closing price that amounts to $5.5 billion.
The remaining $2o billion (more or less) and the government's 300 remaining shares will be dealt with in slow motion fashion over the next 15 months, to avert a big dump of shares on the market. To make back the $20 billion, GM's stock price would have to rise to $72, a highly unlikely event. So the Treasury is admitting that it will "lose" money on the deal.
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Mitt Romney speaks during a campaign rally at the Red Rocks Amphitheatre in Morrison, Colorado. Nate Silver says he probably won't win. Emphasis on the "probably."
In recent weeks, everyone — even casual political observers — has scrutinized the numbers at Nate Silver's FiveThirtyEight blog at the New York Times. Silver, if you've been living under a rock with no media for the past few years, is a 34-year-old rising star in the world of data journalism. He made a name for himself in baseball statistics and neatly transferred that fame over to politics. He basically called the 2008 election. When the New York Times absorbed his once-anonymous blog, he was a made man. (Watch him in uber-nerdy action on Comedy Central's "The Colbert Report" in the video below.)
The political right isn't happy about Nate Silver because, as of Tuesday morning, FiveThirtyEight indicates that Mitt Romney has a less than 10 percent possibility of winning the election. Indirectly, former Reagan speechwriter Peggy Noonan tried to discredit Silver in the Wall Street Journal on Monday with heartfelt rhetoric and a hodgepodge of theories, the most ridiculed of which was the idea that Romney is surging toward victory because across America he's winning the war of the yard signs.
Foreclosure starts have been falling just about everywhere that went for Obama in 2008. But look at how much work is still to be done in L.A. County.
Real Estate listing and analytics service RealtyTrac has put together what it's calling, with no shortage of good timing, an "Election 2012 Housing Health Check," comparing the state of American housing now with four years ago.
Five metrics went into the analysis: average home prices, unemployment, foreclosure inventory, foreclosure starts and share of distressed sales. The bottom line? According to RealtyTrac, 65 percent of local housing markets are "worse off than four years ago."
But here's something interesting: on foreclosure starts, activity declined from four years ago in most counties won by President Obama while it generally increased in counties won by his then-challenger, Sen. John McCain.
Some of this is due to sheer volume and the scale of the foreclosure crisis four years ago. If you look at the chart above — conveniently broken out into blue (for counties Obama won) and red (for counties McCain won) — you can see that the foreclosure problem in Los Angeles County couldn't have gotten much worse. And in four years, it's improved dramatically. But L.A. Country is still well ahead of the rest of the country in the number of foreclosure starts.
Listen in to the DeBord Report, from last Friday's segment.
Last Friday's economy report on "America Now" with Andy Dean followed one day after the Vice-Presidential debate between Joe Biden and Paul Ryan, so Andy and I spent the entire segment debating who won, who didn't win, whether Paul Ryan has any friends, and whether Joe Biden was incredibly rude and abrasive or...a thespian!
We're probably going to spend some time this coming Friday talking about Obama v. Romney, Part II. You can listen live here at 4PM PT. Will Mr. Obama stage a comeback? Or will Romney continue to cut into the President's increasingly slender lead?
We'll also get into some business and economy stuff. Enjoy!
Also, congratulations to Andy and his whole crew — Producer Michelle, Producer Miranda, and Engineer Kyle — for adding a whole bunch of new markets, including Orlando, the land of "100 percent humidity and 0 percent state taxes," according to Mr. Dean.
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US Republican presidential candidate Mitt Romney speaks in the rain during a rally in Newport News, Virginia. He's trying to rake in Wall Street money, with just a few weeks left until the election.
Mr. Romney and Mr. Ryan go in seach of Wall Street money, with cocktails and photo ops at a Hilton in New York: "[A] batch of hedge fund and private equity bigwigs show up on the list, underscoring the broad and deep backing that Mr. Romney is receiving from the upper echelons of Wall Street." (DealBook)
Make more stuff, people! Retail sales in September beat expectations: "[D]ata show that 'consumers are out in force, buying everything that isn’t nailed down.'" (LATimes)
How not to make money: "Endowments and foundations had the worst returns of any class of institutional investor in the year through June, gaining 0.37 percent." (Bloomberg)
A venture capital goes to the Interwebs for a new brand identity — and doesn't do it on spec: "[E]veryone creating new work for this project will be compensated — not just the one winner who will carry out our complete brand identity." (USV)