Debt revamps hindered by credit default swaps Dealscape

Chrysler files bankruptcy.  Let's be clear about who is responsible here.  It is the banks, bondholders, and Wall St. that created the derivatives and Credit Default Swap (CDS) monster.  Derivatives have already created the current economic depression (Bear Stearns, Lehman, Merrill, etc).  Now the presence of CDS's distorts the normal workings of a market economy … Continue reading Debt revamps hindered by credit default swaps Dealscape

GM: Some Bondholders Want Bankruptcy – BusinessWeek

Business Week catches up to Econproph from last month. The barriers to getting a deal done with GM bondholders, and negotiating away enough of that debt to strike a deal and avoid a planned, government-assisted bankruptcy, remain very big, with five weeks to go before the deadline. ...And second, some of the bondholders own credit … Continue reading GM: Some Bondholders Want Bankruptcy – BusinessWeek

Why GM will almost certainly go bankrupt.

Right now, for GM to avoid a bankruptcy filing, it has to get concessions or "sacrifice" from the "stakeholders".  In plain terms this means the union and the bondholders.  The union has already stepped up to the plate. It has sacrificed and offered additional sacrifice contingent on the bondholders.  So far, though, the bondholders haven't … Continue reading Why GM will almost certainly go bankrupt.

Surprise: Bush sort of does the right thing for GM/Chrysler

I'll admit I'm surprised.  My inner cynic suspected the Bush administration would try a pre-packaged Ch. 11 bankruptcy for GM or Chrysler, or that they would dither and play Hamlet so long that the Chrysler, GM, or some big Tier 1 would end up in bankruptcy anyway for Christmas. Instead, GM/Chrysler get their bridge loans.  … Continue reading Surprise: Bush sort of does the right thing for GM/Chrysler

Industry Matters: Why Chap 11 Bankruptcy Won’t Help GM

The NFL should watch out.  Armchair quarterbacking while watching football on TV is being challenged by a new couch potato activity: armchair management. It seems that nationwide people, pundits, Wall Street analysts, and even U.S. Senators have the solution for GM and the U.S.-headquartered auto industry:  file chapter 11 bankruptcy and "re-structure".  It worked for … Continue reading Industry Matters: Why Chap 11 Bankruptcy Won’t Help GM