10/30/09
IWM ema crossing down hard today -2%. MACD crossed below zero. Near oversold but it could get nasty here.
200 dy ema is 5% below here at 54.80 ish
10/29/09
10/28/09
10/27/09
3X , not ETF, 3rd $5 B bailout for GMAC aka ALLY Bank
NEW YORK (AP) -- GMAC Financial Services is in talks with the Treasury Department for a third injection of taxpayer aid as the auto lender faces a November deadline to raise the $11.5 billion capital cushion mandated by results of the government's "stress test" earlier this year.
A Treasury Department spokesman confirmed Tuesday that GMAC is in discussions about securing additional government help.
Of the 19 banks that underwent the government's stress tests, 10 were determined to be undercapitalized. GMAC is the only one of those to not have been able to raise all of its necessary capital from investors.
Citing unnamed people familiar with the matter, The Wall Street Journal reported on its Web site late Tuesday that the U.S. government could hand over another $2.8 billion to $5.6 billion to Detroit-based GMAC. The move would make GMAC the only U.S. company to receive three rounds of bailout aid.
GMAC spokeswoman Gina Proia declined to comment.
The government currently holds a 35 percent equity stake in the auto lender after providing $12.5 billion in aid to keep loans flowing to buyers of GM and Chrysler cars. The latest capital infusion would be in the form of preferred stock, the paper said Tuesday. The government's stake could rise if the new preferred shares were ever converted into common stock.
Last December, the government gave GMAC $5 billion in exchange for 5 million shares and GMAC's agreement to extend financing services to bailed-out Chrysler LLC. Then in May, the Treasury Department announced a new $7.5 billion injection for GMAC. Of that, $4 billion went to support new loans to Chrysler dealers and customers, and the rest went toward boosting GMAC's capital base -- still short of the $11.5 billion the government's "stress test" showed the company would need to stay afloat if the economy worsens.
To help GMAC raise the remaining capital, the Federal Deposit Insurance Corp. took the rare step earlier this year to allow the junk-rated company to gain access to the FDIC's debt guarantee program. The FDIC agreed to guarantee up to $7.4 billion in GMAC-issued debt in case the company defaulted on payment, and has already backed about $4.5 billion worth.
According to the paper, the FDIC told GMAC Tuesday that it would guarantee the remaining $2.9 billion in debt in order to prevent the company from being forced to reduce its lending volume at a time when the U.S. government has a sizable interest in making sure customers can afford to buy vehicles from government-backed automakers General Motors and Chrysler.
The Treasury spokesman declined to comment on whether the government's ownership stakes in GM and Chrysler make it more willing to again help prop up GMAC.
GMAC has been trying to recapture its once-dominant share in the auto financing market. Leasing virtually collapsed during the financial crisis as the resale value on leased cars plummeted and the practice stopped being profitable for lenders. The government-subsidized lender rebranded its banking division earlier this year as Ally Bank, hoping to smooth over its image and lure new customers.
GMAC's market share in the auto financing market has fallen sharply during the crisis as its cash available for lending declined. Banks like J.P. Morgan Chase and Wachovia, meanwhile, scooped up new business. GMAC had 3 percent of the auto financing market in the first six months of the year, down by almost half in the same period a year ago, according to Experian Automotive.
GMAC in August posted a wider second-quarter loss of $3.9 billion, mainly due to booking a $1.6 billion charge related to the company's ResCap mortgage business. GMAC also incurred a $1.2 billion tax charge on its conversion from a partnership, or LLC, to a privately held corporation.
Net revenue fell 22 percent to $1.03 billion from $1.32 billion.
Midway through the quarter, GMAC added Chrysler Group as a preferred lender. However, GMAC's automotive unit lost $727 million in the quarter, as higher unemployment rates in the U.S. pushed the number of delinquent contracts up a percentage point to 3.4 percent.
A Treasury Department spokesman confirmed Tuesday that GMAC is in discussions about securing additional government help.
Of the 19 banks that underwent the government's stress tests, 10 were determined to be undercapitalized. GMAC is the only one of those to not have been able to raise all of its necessary capital from investors.
Citing unnamed people familiar with the matter, The Wall Street Journal reported on its Web site late Tuesday that the U.S. government could hand over another $2.8 billion to $5.6 billion to Detroit-based GMAC. The move would make GMAC the only U.S. company to receive three rounds of bailout aid.
GMAC spokeswoman Gina Proia declined to comment.
The government currently holds a 35 percent equity stake in the auto lender after providing $12.5 billion in aid to keep loans flowing to buyers of GM and Chrysler cars. The latest capital infusion would be in the form of preferred stock, the paper said Tuesday. The government's stake could rise if the new preferred shares were ever converted into common stock.
Last December, the government gave GMAC $5 billion in exchange for 5 million shares and GMAC's agreement to extend financing services to bailed-out Chrysler LLC. Then in May, the Treasury Department announced a new $7.5 billion injection for GMAC. Of that, $4 billion went to support new loans to Chrysler dealers and customers, and the rest went toward boosting GMAC's capital base -- still short of the $11.5 billion the government's "stress test" showed the company would need to stay afloat if the economy worsens.
To help GMAC raise the remaining capital, the Federal Deposit Insurance Corp. took the rare step earlier this year to allow the junk-rated company to gain access to the FDIC's debt guarantee program. The FDIC agreed to guarantee up to $7.4 billion in GMAC-issued debt in case the company defaulted on payment, and has already backed about $4.5 billion worth.
According to the paper, the FDIC told GMAC Tuesday that it would guarantee the remaining $2.9 billion in debt in order to prevent the company from being forced to reduce its lending volume at a time when the U.S. government has a sizable interest in making sure customers can afford to buy vehicles from government-backed automakers General Motors and Chrysler.
The Treasury spokesman declined to comment on whether the government's ownership stakes in GM and Chrysler make it more willing to again help prop up GMAC.
GMAC has been trying to recapture its once-dominant share in the auto financing market. Leasing virtually collapsed during the financial crisis as the resale value on leased cars plummeted and the practice stopped being profitable for lenders. The government-subsidized lender rebranded its banking division earlier this year as Ally Bank, hoping to smooth over its image and lure new customers.
GMAC's market share in the auto financing market has fallen sharply during the crisis as its cash available for lending declined. Banks like J.P. Morgan Chase and Wachovia, meanwhile, scooped up new business. GMAC had 3 percent of the auto financing market in the first six months of the year, down by almost half in the same period a year ago, according to Experian Automotive.
GMAC in August posted a wider second-quarter loss of $3.9 billion, mainly due to booking a $1.6 billion charge related to the company's ResCap mortgage business. GMAC also incurred a $1.2 billion tax charge on its conversion from a partnership, or LLC, to a privately held corporation.
Net revenue fell 22 percent to $1.03 billion from $1.32 billion.
Midway through the quarter, GMAC added Chrysler Group as a preferred lender. However, GMAC's automotive unit lost $727 million in the quarter, as higher unemployment rates in the U.S. pushed the number of delinquent contracts up a percentage point to 3.4 percent.
10/26/09
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