[manapua]

Holy crap. I feel like I've been punched in the head and thrown over Niagara Falls in a barrel, then punched in the gut... what the hell just happened?

Contract law is nullified, just like that? That's a primary reason that government exists at all. Holy #$%^&%$ing #%^$.

Fiat is an apt name to be mixed up in this story. Having gutted any meaning out of contractual protections, there's effectively no law anymore, just fiat. Poof. Gone.

[muawiyah]

Actually, what Obama's lawyers are doing is pretty obvious. They're following the law just exactly the way it was written the day those bonds were sold.

At that time the order of precedence in a bankruptcy was:

1. Postal Service,

2. IRS,

3. Other taxing authorities,

Employee wage claims,

Preferred debt holders, and then every other category of person owed money.

The UAW share is simply the shares authorized to be credited to the health care fund being set up by the federales and UAW to take care of employees and retirees. It is considered to be part of "employee wage claims".

That's the point that will be argued in court down the line by preferred debt holders.

So far no one has one on that point.

HOWEVER, the issue is one I don't think most American or Foreign bond holders will understand well enough to not make them nervous.

[GOPJ]

Contract law is nullified, just like that? That's a primary reason that government exists at all. Holy #$%^&%$ing #%^$. Fiat is an apt name to be mixed up in this story. Having gutted any meaning out of contractual protections, there's effectively no law anymore, just fiat. Poof. Gone.

It's as bad as we think it is... And Obama? He's a lawyer - he knows what he's done.