Reuters says GM is making a big deal out of sending a $1b check to the U.S. Treasury next Wednesday, “attempting to settle the loan with the government ahead of schedule.”
Who are they kidding? Reuters rightly points out that last November, “GM had said it would begin making quarterly payments in December of $1.2 billion to the U.S. Treasury and the governments of Canada and Ontario.” This coming Wednesday, the quarter is up and it’s time to feed the beast, boys.
GM “was given $50 billion of government financing to restructure in a bankruptcy steered by the U.S. Treasury, which remains a 61 percent owner of GM stock,” as Reuters reminds us. So if they keep up those quarterly payments, it will be 42 quarters, or 10 years, more or less.
Wait, we forgot the interest! Could the green eyeshade contingent please calculate how long it takes to pay off a $50b loan with $1.2 quarterly payments, at a generous prime rate of 3.25 percent?