General (Obama's) Motors...

President Obama has touted General Motors as a successful example of his administration's policies.

* OH... IT'S AN EXAMPLE OF HIS POLICIES ALRIGHT! READ ON!

Yet GM's recovery is built, at least in part, on the increasing use of subprime loans.

* WHAT...?!?!

The Obama administration in 2009 bailed out GM to the tune of $50 billion as it went into a managed bankruptcy.

* NO. THE GOVERNMENT OF THE UNITED STATES - EXECUTIVE AND LEGISLATIVE BRANCHES (BOTH CONTROLLED BY THE DEMOCRATS AT THE TIME) ORDERED A BAILOUT OF SPECIAL INTERESTS USING PUBLIC MONIES.

Near the end of 2010, GM acquired a new captive lending arm, subprime specialist AmeriCredit. Renamed GM Financial, it has played a significant role in GM's growth.

* OH, CHRIST...

The automaker is relying increasingly on subprime loans, 10-Q financial reports shows.

(*PURSED LIPS*)

Potential borrowers of car loans are rated on FICO scores that range from 300 to 850. Anything under 660 is generally deemed subprime.

* AND YET... (LET ME GUESS...)

GM Financial auto loans to customers with FICO scores below 660 rose from 87% of total loans in Q4 2010 to 93% in Q1 2012.

* WELL...? (YO...! BUDDY! YOU WHOSE NAME DARE NOT BE MENTIONED... IT'S... THE... GOVERNMENT... - IN THIS CASE OBAMA AND "HIS" THEN HOUSE AND SENATE - WHICH ALLOW THIS!)

The worse the FICO score, the bigger the increase.

(*PURSED LIPS*)

From Q4 2010 to Q1 2012, GM Financial loans to customers with the worst FICO scores — below 540 — shot up 79% to more than $2.3 billion. The second worst category, 540-599, rose 28% from about $3.4 billion to $4.3 billion.

* OH... AND GET THIS! (READ ON!)

Prime loans, those above 660, dropped 42% to $676 million.

(*HEADACHE*)

GM Financial provides just over 8% of GM's financing. Prior to 2006, GM's captive lending arm was GMAC, but GM sold a controlling stake in 2006. GMAC later renamed itself Ally Financial and continues to provide the bulk of GM's financing.

* WHAT A BUNCH OF PHONY CRAP...

(*JUST SHAKING MY HEAD*)

At the peak of the credit crisis and recession in late 2008, Ally announced that it would move away from subprime lending. By spring 2010 GM's new management, led by North American executive Mark Reuss, wanted to move back into subprime, fearing that GM couldn't compete.

* AND OBAMA'S REACTION...? THEN SPEAKER-PELOSI'S REACTION...? THEN-AND-NOW SENATE MAJORITY LEADER REID'S REACTION...?

Subprime lending in cars is not as risky as in housing. Car loans are cheaper, so customers have an easier time making payments. When they do go into default, the cars can be repossessed and sold to recover some of the loss.

* WHICH IS FINE AND DANDY WHEN IT'S NOT MY MONEY AT STAKE! TAXPAYER MONEY "INVESTED" WITH US HAVING NO CHOICE IN THE MATTER!

"The subprime market grew as a result of the recession," said GM spokesman Jim Cain. "Our experience, however, is that with proper management they are very good risks."

* WITH THEIR EXPERIENCE...? THE GUYS WHO BROUGHT THE AMERICAN AUTO INDUSTRY TO ITS KNEES - AND TO THE BAILOUT TABLE...?!?! (FORGIVE ME IF I'M LESS THAN COMFORTED...)

He points to GM's credit losses which have not risen above 5.5% since late 2010.

* TAXPAYER BACKED RISK re: LOSSES... PRIVATE PROFIT re: GAINS. I'M STILL NOT COMFORTED!

Nevertheless, since it acquired GM Financial, GM has seen its subprime loans grow from about 4.8% of sales in Q4 2010 to 8.2% in Q1 2012. The industry average is about 6%.

(*CLAP...CLAP...CLAP*)

"Is GM taking on more risk than is safe given our uncertain economy?" asks Edward Niedermeyer, TheTruthAboutCars.com editor-at-large. "They may be trying to goose short-term sales with subprime lending to boost its stock price, which is tied to the government getting out of its GM investment."

* AND TIED TO EXECUTIVE BONUSES...???

GM still owes about $26.4 billion in direct aid to the federal government. The Treasury owns 26.5% of the automaker, or 500 million shares. The stock price would need to be 53 to recoup those taxpayer costs.

GM shares closed Friday at 19.67 after hitting a post-IPO low on Wednesday.

(*RUEFUL CHUCKLE*)

When pushing the Dodd-Frank financial overhaul, Obama told Americans, "you have a stake in it if you've ever tried to take out a home loan, a car loan, or a student loan, and been targeted by the predatory practices of unscrupulous lenders."

While the administration has targeted subprime mortgage lending, it seems to have turned a blind eye to auto subprime loans.

* SUBPRIME MORTGAGE LENDING IS PROBABLY UP AS WELL! (YEP... JUST GOOGLED IT...)

"The Obama administration has seen to it that the Consumer Financial Protection Bureau is important in the subprime mortgage arena," said Niedermeyer. "But it has exempted auto-finance from that. I definitely think it is a double standard."

* CAN YOU SAY U*N*I*O*N*S...

He also wonders if the Treasury will be able to recoup its GM aid: "The conventional wisdom has been that consumers have too much debt and need to de-leverage. Having that weak underlying foundation makes this rise into subprime lending by GM more worrisome."