Creative accounting from General Motors

Remember this great news from troubled Government General Motors?

General Motors Co. plans to disclose Wednesday early repayment of its remaining $4.7 billion in U.S. government loans, a step toward shedding the stigma of last year’s federal bailout, a person familiar with the matter said Monday.

GM Chairman and Chief Executive Edward E. Whitacre Jr. believes repaying what is left of its $6.7 billion U.S. Treasury loan is a critical step toward winning back U.S. customers. Ford Motor Co.’s status as the only Detroit auto maker to avoid a government bailout has helped the company outperform its rivals.

An early repayment signals that GM executives are confident it is financially stable without the cash. GM lost $4.3 billion in the last half of 2009, but Mr. Whitacre has forecast a “solid” first-quarter when GM releases its financial results next month.

Shareholders rejoice!!!

…not so fast. It appears all G.M. did was take its available TARP credit line and use it to pay down the Treasury loan. That’s correct, the company used government money to pay a government loan, but all we read about was repaying the loan.

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