Comments on: The stress test’s biggest loser: GMAC

By: Randy Gentry

Randy Gentry — Mon, 15 Jun 2009 22:23:39 +0000

Will someine please tell me if the GMAC bonds thht matured in May, 2009 were paid off at full face value, or not! If not, how were they paid? I sold mine at a loss and am wondering now if I should have hung on. Thanks!

By: Ron Stone

Ron Stone — Fri, 15 May 2009 14:58:19 +0000

While your article was helpful, frankly I am getting tired of news about X number of banks this and X number of banks that (stress test etc.). Why not simply give everyone a list of these banks, even if you don’t have much data on them?

By: steve katen

steve katen — Fri, 08 May 2009 16:48:38 +0000

GMAC as a viable entity was doomed sometime ago. Its main sources of business that being GM and now Chrysler are without much conjecture – collapsing. Does Fiat need GMAC ? Will the brands GM and Chrysler survive their respective Bankruptcies, it doesnt matter. Simply stated no one is buying cars. So GMAC is no longer viable as a business model – its just not relavant as a company. The days of GMAC financing Dodges and Pontiacs no longer exist ! GMAC is a lame duck company whos fate is sealed. GMAC is dead and insolvant.

By: Wallace Renfro

Wallace Renfro — Fri, 08 May 2009 16:20:31 +0000

Good post. GMAC is the 2nd largest credit provider embedded within an industrial company, the largest being GE Capital. I’m curious to see the stress test results extrapolated to impute a comparable grade on General Electric’s finance division. GE has been resolute — they claim they don’t need capital (they spent extensive time with analysts, equity and bond investors making the point). With Wells Fargo and other steadfast “capital raising deniers” relenting, I hope GE takes advantage of the current market window themselves. Cheers!

By: J della punta

J della punta — Fri, 08 May 2009 12:35:37 +0000

A Simulation has nothing to do with a stress test, which is a scenario.
Problem is this whole exercise is based on Macro economic conditions deteriorating whereas the main unknown lies in the forward no-default probabilities (aka marginal conditional defaults) for the assumed points in time.
Problem is credit curves are either implied through prices or (most often) history, which in this specific instance has additionally been extrapolated….

By: Jalesh Dikshit

Jalesh Dikshit — Fri, 08 May 2009 00:57:00 +0000

Simulation of a highly complex system is very difficult. The simplest solution would be start making building like roads and ask people to leave without paying, the idea of employmentism for survival has problem of creating unnecessary employments for increasing population. The simple solution does sound stupid at first but that would be the end of simulation if it is run for many years for entire earth…

By: amg

amg — Fri, 08 May 2009 00:08:16 +0000

More than half the worst case losses reside in ResCap, a walled off sub of GMAC. Converting the Govt’s pfd’s and cutting ResCap loose is all they need to do to comply with the capital requirements.

By: Raj

Raj — Thu, 07 May 2009 22:52:45 +0000

On a personal note…As long as GMAC has enough cash to pay out my bond maturing May 21, I will be happy!!!!

By: rock

rock — Thu, 07 May 2009 22:41:06 +0000

With all these results how can they still assume that the economy is turning around?
just trying to change peoples view doesnt change the facts!!!!!

By: Mike

Mike — Thu, 07 May 2009 22:35:15 +0000

The stress tests were a brilliant idea. At first they seemed the idea was to fool the public, but that was not the point. It was a stall tactic… a cooling off period. Timmy shoots & scores!!