A vigorous political blog, not for the fainthearted.
Monday, June 8, 2009
Whoa!
Perhaps there is hope. Justice Ginsberg (who I would have guessed to be firmly in O's pocket) says timeout to the Chrysler deal. Could it be that we might actually investigate the rule of law concerning bankruptcies?
Ultimately, the deal will go through. No rules were broken concerning bankruptcy protocol. The senior debt holders did better with the rescue than without; $2B v $800mm +/-. That is why most fell in behind the plan. Those who are suing have a political agenda, not economic.
The UAW's piece of the action was a requirement of the DIP, who would have to otherwise pony up for the pensions (PBGC) without said workout. The senior debt holders were not able to find any other DIP with or without superior terms.
God bless capitalism and God bless this administration!
The plaintiff does not have a POLITICAL agenda! It is the STATE OF INDIANA. They have milions in Chrysler bonds in the state teachers retirement fund. Not all bondholders are fat cat hedge funds. What an ignorant statement. You liberals never let facts get in the way. Just demonize someone or something.
The ignorance is yours, Wenzel. Absent the rescue the secured creditors will collect $800mm +/- over time. There is simply no market for what they would be liquidating. Who is buying rust belt industrial land and closed factories?
With the rescue, the same creditors get $2B right away. The group's primary complaint was that Uncle Sam didn't step up more, which of course has been the bond-buyer strategy since bailouts came into favor. They had not planned on Obama being so miserly with taxpayer dollars.
The UAW action was at the insistence of DIP lender (federal government) who would otherwise have to rescue pensions through PBGC. The union was not treated as a superior creditor to secured creditors, period. Their piece primarily bails out pensions and rewards still more wage + work rule concessions.
I am very familiar with STATE of INDIANA pension funds. It was State Treasurer Richard Mourdock, a GOP political hack, that let the suit. Yesterday on CNBC he said if the government can't torture in extraordinary circumstances then they can't "change the rules of bankruptcy" (a phony premise). Does that sound like an economic argument or a political yahoo trying to make hay?
If you're right the Supreme Court will pass this back to the bankruptcy court in a day or two. If I'm right they will rule on it and it will take longer. Time will tell.
Jim + Wenzel's last comments are both correct. It will be interesting to watch.
I am not unhappy with Ginsberg - I think that there is a great deal of activity behind the scenes at SCOTUS right now. It only takes four votes to hold the case up, which effectively kills the deal. I think that Roberts came to Ginsberg and asked for more time to determine just where the court stands. He could have mustered the four votes to agree to hear the case, but I don't think he wants to kill Chrysler absent a compelling and winnable constitutional case by the Plaintiff.
Being interested, well read, and generally informed, I can hypothesize about what is happening behind the closed doors of SCOTUS. For background, I suggest reading Woodward's "Brethren" and Toobin's "The Nine.
I acknowledge that those getting their news and views from Fox will be left to fantasize about topics first discovered in their pre-teen years.
If you were not Fox saturated, you would understand that "established law" was not bypassed. No one was screwed. If the secured creditors could have done better through liquidation, the federal bankruptcy judge would have so ordered. The bondholders lost their money long before Obama took the oath of office.
9 comments:
Ultimately, the deal will go through. No rules were broken concerning bankruptcy protocol. The senior debt holders did better with the rescue than without; $2B v $800mm +/-. That is why most fell in behind the plan. Those who are suing have a political agenda, not economic.
The UAW's piece of the action was a requirement of the DIP, who would have to otherwise pony up for the pensions (PBGC) without said workout. The senior debt holders were not able to find any other DIP with or without superior terms.
God bless capitalism and God bless this administration!
The plaintiff does not have a POLITICAL agenda! It is the STATE OF INDIANA. They have milions in Chrysler bonds in the state teachers retirement fund. Not all bondholders are fat cat hedge funds. What an ignorant statement. You liberals never let facts get in the way. Just demonize someone or something.
The ignorance is yours, Wenzel. Absent the rescue the secured creditors will collect $800mm +/- over time. There is simply no market for what they would be liquidating. Who is buying rust belt industrial land and closed factories?
With the rescue, the same creditors get $2B right away. The group's primary complaint was that Uncle Sam didn't step up more, which of course has been the bond-buyer strategy since bailouts came into favor. They had not planned on Obama being so miserly with taxpayer dollars.
The UAW action was at the insistence of DIP lender (federal government) who would otherwise have to rescue pensions through PBGC. The union was not treated as a superior creditor to secured creditors, period. Their piece primarily bails out pensions and rewards still more wage + work rule concessions.
I am very familiar with STATE of INDIANA pension funds. It was State Treasurer Richard Mourdock, a GOP political hack, that let the suit. Yesterday on CNBC he said if the government can't torture in extraordinary circumstances then they can't "change the rules of bankruptcy" (a phony premise). Does that sound like an economic argument or a political yahoo trying to make hay?
No charge for the schooling.
Sounds like we have a disagreement. As luck would have it, there is this thing called the Supreme court.
I'm surprised Rich(ie) is not going after Ginsberg for standing up to the "O".
If you're right the Supreme Court will pass this back to the bankruptcy court in a day or two. If I'm right they will rule on it and it will take longer. Time will tell.
Jim + Wenzel's last comments are both correct. It will be interesting to watch.
I am not unhappy with Ginsberg - I think that there is a great deal of activity behind the scenes at SCOTUS right now. It only takes four votes to hold the case up, which effectively kills the deal. I think that Roberts came to Ginsberg and asked for more time to determine just where the court stands. He could have mustered the four votes to agree to hear the case, but I don't think he wants to kill Chrysler absent a compelling and winnable constitutional case by the Plaintiff.
Thus, Wenzel was right. We shall soon see.
Rich(ie)
Most of us have fantasies about...girls...cars...sports teams.
What...you lay in bed under the sheets dreaming about policy wonk ideas? How do you know what happens in a closed court?
You cannot have the Government broker a deal which favors one group and bypasses established law.
I certainly hope Judge Ginsberg's impertinence does not dissuade the benevolent "O" from curing her cancer.
Being interested, well read, and generally informed, I can hypothesize about what is happening behind the closed doors of SCOTUS. For background, I suggest reading Woodward's "Brethren" and Toobin's "The Nine.
I acknowledge that those getting their news and views from Fox will be left to fantasize about topics first discovered in their pre-teen years.
If you were not Fox saturated, you would understand that "established law" was not bypassed. No one was screwed. If the secured creditors could have done better through liquidation, the federal bankruptcy judge would have so ordered. The bondholders lost their money long before Obama took the oath of office.
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