GM Employee Fund Manager Dumps all GM Shares

This sure ain't a good sign. Bloomberg reports that the Fund which manages GM employees 401ks just dumped all of GM shares because they would be worthless in bankruptcy:

State Street Bank and Trust Co., manager of a 401(k) investment fund for General Motors Corp. employees, has sold the majority of its shares in the automaker on concern that the stock could lose all value in a bankruptcy.

State Street sold 75 million shares, or about 12.4 percent of GM outstanding common stock, between March 31 and yesterday, Julie Gibson, a GM spokeswoman, said yesterday in an interview. It held most of those shares in a 401(k) fund for 29,800 employees and retirees. The fund is one of several options available in the GM employee-retirement savings plan.

The investment company held a total of 103 million GM shares at the end of the year, according to Bloomberg data.

And you see that percentage? 12.4% of all outstanding common stock, now that has gotta hurt. The stock is still valued at $1.69 so existing shareholders will assuredly take that as a major indicator.

This is becoming painful to watch.

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I would too

Looking at it, unless I saw evidence that would tell me otherwise. Secondly, why didn't they attempt to sell the stock when it was...oh I don't know...in the double digits? You know, earn ...no not the right word...preserve some money for those 401ks?

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Sale of GM Stock by GMSSP Administrator

The article doesn't specify whether the GM stock funds sold represented employee designated payroll contributions, company matching, or GM stock purchased by an employee/retiree initiated, directed exchange between one or more funds to GM stock fund. I think the administrator is on shakey ground if she has sold GM stock in the 3rd scenario, taken as a flyer for speculative purchases. I'll wait to see what the letter says. Regardless, if GM doesn't go belly up and the stock remains intact and thrives.....she's in deep sh**, no matter what the intention.

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If GM doesn't go BK and the shares are left where they are

hell...I may start to consider buying them. Because in that scenario, the deals have been done to keep the company going until it reaches profitability. Honestly, if you think about it, at these prices and no chance of shareholder wipeouts, its cheaper to buy the stock than Call options. In fact, it WOULD be like buying a Call option, only without an expiration date! :)

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State Street Criminal Action GM Employee Owned Stock Sale

30,000 employees/retirees choose to invest in GM common stock in the GMSSP (401k) to the tune of 75 million shares. They did so of their own free will and could have sold out at any time they wanted. They didn't want to sell. There was no advance notice, no request for authorization, no option to transfer stock held to a rollover IRA. THE BASTARDS JUST SOLD IT BEHIND OUR BACKS!!!Here are a couple of comments from the FREEP article:

jznzfs wrote:
Well, it's Monday morning and GM is up $ .50. I have been on the phone to Fidelity (they're reading from a script), State Steet refuses to take calls, I even tried to call Kathleen Barclay, VP Benefits and she won't take calls. I have...err had about 4500 shares of GM in the plan. At least I have 1250 shares in a partial rollover. DO I SMELL A RAT THAT THEY DIDN"T WANT EMPLOYEE OWNERSHIP!!!
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04/27/2009 12:46:23 p.m. EDTReplying to chuckiechoochoo:

since i controlled over 1300 shares of gm common in the psp 401k and am less than happy about the current situation i will take a wait and see position if after being dumped by the company if gm common ever goes back up there will be a grass roots class action suit filed against state street and gm global operations of mammoth proportions and i will be at the head of it

jznzfs wrote:
Well, it's Monday morning and GM is up $ .50. I have been on the phone to Fidelity (they're reading from a script), State Steet refuses to take calls, I even tried to call Kathleen Barclay, VP Benefits and she won't take calls. I have...err had about 4500 shares of GM in the plan. At least I have 1250 shares in a partial rollover. DO I SMELL A RAT THAT THEY DIDN"T WANT EMPLOYEE OWNERSHIP!!!
jznzfs
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chuckiechoochoo wrote:

since i controlled over 1300 shares of gm common in the psp 401k and am less than happy about the current situation i will take a wait and see position if after being dumped by the company if gm common ever goes back up there will be a grass roots class action suit filed against state street and gm global operations of mammoth proportions and i will be at the head of it
04/26/2009 11:17:44 p.m. EDTsince i controlled over 1300 shares of gm common in the psp 401k and am less than happy about the current situation i will take a wait and see position if after being dumped by the company if gm common ever goes back up there will be a grass roots class action suit filed against state street and gm global operations of mammoth proportions and i will be at the head of it chuckiechoochoo
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jznzfs wrote:

Replying to NonResTaxpayer:

As a GM employee, I personally find this move outrageous. GM stock is down almost 95% over the past year, so obviously those of us who left a small portion of our investments in the GM Common Stock Fund were willing to accept losing the final 5% for a possible sizeable gain later. If we had no faith in an out-of-court solution to our problems, we would have sold our shares earlier at $3-$6/share......
I am similarly outraged. If I choose to make a speculative move in my financial investments, then so be it. I am capable of losing/gaining from my investment decisions and bearing the consequences of either outcome. I don't need interference from a fund ADMINISTRATOR!!! She had better hope that GM goes belly up and GM common goes to zip. I would be interested in a detail accounting of the sell dates and amounts to see how well they were able to "gauge the market", since they are professional investors and our fiduciary custodians.

04/26/2009 1:04:18 p.m. EDTReplying to NonResTaxpayer:

As a GM employee, I personally find this move outrageous. GM stock is down almost 95% over the past year, so obviously those of us who left a small portion of our investments in the GM Common Stock Fund were willing to accept losing the final 5% for a possible sizeable gain later. If we had no faith in an out-of-court solution to our problems, we would have sold our shares earlier at $3-$6/share......

jznzfs wrote:
I am similarly outraged. If I choose to make a speculative move in my financial investments, then so be it. I am capable of losing/gaining from my investment decisions and bearing the consequences of either outcome. I don't need interference from a fund ADMINISTRATOR!!! She had better hope that GM goes belly up and GM common goes to zip. I would be interested in a detail accounting of the sell dates and amounts to see how well they were able to "gauge the market", since they are professional investors and our fiduciary custodians.
jznzfs
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Fedility are crooks...

http://www.bloomberg.com/apps/news?pid=20601103&refer=us&sid=aOHwqQ_AmZAY

"The settlement concludes a three-year probe that tainted the Boston-based money manager, known for policies aimed at protecting fund investors. The company failed to seek the best terms when trading for the funds because employees routed the transactions to brokers who doled out Super Bowl tickets and private-jet trips to Mexico, the SEC said. "

It would not surprise me that they sold the GM stock to institutions that wanted them cheap knowing that GM is not going to BK..........and IMHO there will not be a BK.....

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What is the job of an

What is the job of an independent fiduciary? its to look out for their investors!!! clearly they didn't do that here!! why did they wait until the stock was 1.86 to exchange them out of it...!!! this is not a stock this is a STOCK FUND...... and GM's bad news was all over..... they had to have known GM was going to file bankruptcy...on top of all that, they were GM'S BOND holders also.... isn't that CONFLICT of of interest???
What about ERISA? didn't they breach that also???
THEY DID NOT MANAGE THE FUNDS WELL AT ALL!!!WHAT IS OUR GOVERNMENT DOING ABOUT THIS??............NOTHING!!!....... SO SAD!!!!

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