U.S. Squeezes Auto Creditors (aka the fraud takes on bankers)

[SpartanDem]

This article was posted a few days in LBN. You wanna know how many responses it got? Six. Yes, six after all the anger following firing of GM's CEO, accusations of being anti-labor and criticism of the Treasury Dept in general you'd think this place would love a story showing the Administration trying to stick it to bankers. There were multiple threads across the various forums with hundreds of responses about what Obama was doing to the auto industry and this was posted in one location with six pathetic responses. I was going to let this go, but being reminded tonight of the way people pile on Obama I'm reposting this maybe it'll seven this time.

APRIL 10, 2009 U.S. Squeezes Auto Creditors
Treasury Seeks Billions in Concessions for GM and Chrysler From Banks,


The federal government is taking an increasingly hard line with the creditors of General Motors Corp. and Chrysler LLC, trying to squeeze billions of dollars in concessions out of banks, bondholders and others.

In both cases, the U.S. is directly and not-so-directly managing negotiations for the car companies as they prepare for what could be Chapter 11 bankruptcy filings.

Chrysler has been told by the Treasury Department to get a deal done with creditors by the end of April, while GM has until the end of May. A Treasury spokeswoman declined to comment on dealings with GM and Chrysler debtholders.

GM's restructuring could play out in one of two ways. It could successfully negotiate cost-cutting concessions with unions and bondholders so it can become viable outside of bankruptcy. Or, in the more likely scenario, it will reorganize by filing for Chapter 11, said people familiar with the situation.

The Treasury Department is pushing GM to offer its bondholders, who are owed $29 billion, a small portion of shares in the company. That's a sharp cut from a bond-exchange offer GM made two weeks ago, which included about $8.5 billion in cash and new debt in the company as well as 90% of GM's stock, said people familiar with the terms.

http://online.wsj.com/article/SB123932036083306929.html?mod=googlenews_wsj

[jkshaw]

1. Thanks, this is good news.

[spag68]

2. Union workers

Again the unions get lumped in with the real bastards in the situation. They have already been cut to the bone with givebacks. The stockholders have already given up 90% of the value of their stock, the banks and creditors not so much as a dime. I personally have some GM stock and I would gladly give up what's left if I saw the high rollers being forced to give up some of their profits. Don't forget we don't know how much these creditors have already pocketed over the years, like a credit card company that has collected twice what you charged and wants twice more to settle the account.

[amandabeech]

3. I'll be happier when either the UAW retirees don't have their pensions and health insurance

pulled out from under them--many are too old and sick to work.

I'll also be happier when Obama puts the screws to those who hold bonds on bailed out financial companies.

I'd also like to know how many of those bondholders have purchased CDS "insurance" on GM or Chrysler bankruptcy from any entity, foreign or domestic, that has received taxpayer bailouts, directly or indirectly.

[Pirate Smile]

4. Their focus has been on the bondholders/Creditors ever since Obama fired Wagoner.