Posted on 05/20/2009 11:25:48 AM PDT by Nachum
Indiana will no longer invest in bonds issued by banks and automakers who receive federal bailout money.
Bondholders are supposed to be at the head of the line for repayment if a company goes bankrupt. But State Treasurer Richard Mourdock says the government rewrote the rulebook for the Chrysler bankruptcy, leaving investors with 29 cents on the dollar. Mourdock says that cost state investment funds $5.6 million
(Excerpt) Read more at wibc.com ...
The list, ping
The states that aren’t on the dole should start shutting out the Federal money grubbers. There is no future in doing business with BO and Geithner.
Obamanomics at work. There are a lot of things Indiana shouldn’t invest in any longer...this is just one of them.
Pure bovine waste, who writes up this crap!!!
Pure bovine waste, who writes up this crap!!!
Nope, just do not want to lose money. If they had remained at the head of the line they wouldn't be making this move.
Also; the State should/could clear all federal employees as foreign workers.. with State passports.. for appropiate monitoring.. Because federal employees are State security risks..
Thinking............. (and thats just for starts)..
OK, but foreign and domestic investors may no longer invest in State and Local bonds if they accept porkulus funds. Obama's vicious assault on federalism is amazing.
Good for Indiana. Nothing like consequences . . .
It also effects non-Tarp companies. Corporate bonds have lost value and will need to be sold by many institutions.
>>Bondholders are supposed to be at the head of the line for repayment if a company goes bankrupt.
>
>Pure bovine waste, who writes up this crap!!!
That’s actually the way it’s supposed to work for disbursements on a bankruptcy, first bond-holders (those that lent to the company), then preferred-stock holders, then regular [common-] stocks as assets are liquidated.
Captain Obvious wins again.
I spoke with the PA Deputy State Treasurer for Investments about this news from Indiana. He told me that although there is no express policy like this in PA, bonds from these organizations would probably not quality under our investment guidelines. Their ratings would be too low, and thus we’d probably have the same effect without the policy. He was interested in the news however, and I’ve sent him the link. I think it’s good for taxpayers to see this kind of news release. At least someone at the state level is retaining a measure of sanity and looking out for the taxpayers.
No it is not, a couple of weeks back I posted the normal pay out in bankruptcy!!! It is roughly, The taxes are paid, the attorneys are paid, the court costs are paid, includes the bankruptcy management staff, the secured debtors are paid, that is the ones with a lien of record in a court house some where’s. The rest is up to the bankruptcy judge normally paid on some sort of percentage formula.
When Obama and his gang coerced senior debtholders into a lesser deal than the junior bondholders, they (Obama & team) effectively violated century old laws of senior vs junior debtholders.
The junior bondholders were the unions, so of course they got a better deal than those big bad investment houses.
But from now on, we will see more investors like this refusing to play in that arena anymore...driving up the cost of capitol for many many companies...
No one would want to invest in a company that is subject to TeamObama and their manipulation....
All secured claims are to be paid before general unsecured claims. The problem is that virtually all claims of the labor unions being general unsecured claims, the secured claimants are being shafted.
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