Posted on 04/30/2009 11:32:59 AM PDT by Scanian
Chrysler is going into Chapter 11 bankruptcy, despite the Obama administration’s efforts to keep it out.
The problem was that a group of small bondholders rejected the deal that car czar Steven Rattner and his deputy (and it seems the real dealmaker) Ron Bloom.
The bondholders made a good point. They are secured creditors, and in our bankruptcy law secured creditors get paid off in full before unsecured creditors get anything. That’s a sound legal principle: why would secured creditors lend anyone anything unless they can get their security back if the loan isn’t paid off? In this case, the small bondholders were willing to settle for only 60% of what they were owed. But, they complain, the government wouldn’t negotiate directly with them, but only through JPMorganChase, which (unwillingly) took TARP money on October 13 and thus is under pressure to do what the government wants.
Translation into politispeak: The government squeezed the small bondholders too hard in order to protect the United Auto Workers, which of course has over the years been a bounteous source of money (and manpower) for the Democratic party. The government can muscle the big banks, but it can’t (at least not yet) muscle creditors whom it hasn’t forced to take its money.
(Excerpt) Read more at washingtonexaminer.com ...
The operative term here is 'at least not yet'. Soon though.
Rattner and Bloom. An evocation of the conmen Bialystok and Bloom.
Hopefully GM will follow next. If I wanted to buy GM I’d buy their stock or their bonds. Let them go bankrupt. Then their executive compensation and labor contracts all get voided out and renegotiated. Of course, that’s what President Obama wants to prevent. Screw the general public, but protect executives and unions.
In the last 12 years I’ve had no annual raise twice and had my pay CUT 5% once. My company went into Chapter 11, came out, and then went Chapter 7 (liquidation). Nobody bailed me out. Time for them to take their medicine. Why should I pay for someone to get a better deal than I’ve gotten?
Thank you, WE! Wondered how long it would take for someone to comment on O’s immediate and unequivocal vilification of “capitalists.” But the rest of the dots need to be connected . . .
Yes, but not nearly so sympathetic.
Chrysler is going into Obama’s sweet deals bankruptcy, not Chapter 11...
bttt
Note, I hear the Obamaton's are naming names, i.e Oppenheimer Funds. Opp Funds are Mass Mutual of Springfield Mass.
I am suprised, liberal bastion Springfield has become, Their is one standout. Kudos to them...
Who is going to buy a car from a company owned by a mob union and the government?
“Who is going to buy a car from a company owned by a mob union and the government?”
Not me! Never again!
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