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U.S. markets recover from steep losses
WASHINGTON, May 19 (UPI) -- White House economist Lawrence Summers said U.S. automaker General Motors Co.'s initial public offering could allow for a complete payback of bailout funds.
Summers, director of the National Economic Council, said the government could recoup "most, if not all" of the $50 billion investment it has made in GM to help pull it through a prolonged industry-wide slump, the Detroit Free Press reported Wednesday.
GM went through bankruptcy last summer. When it emerged, the taxpayer's $50 billion investment was set up as government ownership of 61 percent of the company and about $6.7 billion in loans.
GM has paid back the loans. Earlier assessments, however, consistently said it would take years for the company to repay the government the other $42 billion.
New estimates, however, estimate the company's initial public offering later this year would raise up $75 billion to $78 billion.
"The prospects of repayment are brighter than they were a year ago," Summers said at an economic forum at the Brookings Institute.
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