Chrysler not to pay back gov. "loans"

[Tempest]

http://money.cnn.com/2009/05/05/news/companies/chrysler_loans/?postversion=2009050516

Quote:
NEW YORK (CNNMoney.com) -- Chrysler LLC will not repay U.S. taxpayers more than $7 billion in bailout money it received earlier this year and as part of its bankruptcy filing.

This revelation was buried within Chrysler's bankruptcy filings last week and confirmed by the Obama administration Tuesday. The filings included a list of business assumptions from one of the company's key financial advisors in the bankruptcy case.

Tax payers taking it in the shorts for the unions...

 

[GROUCHO MARX]

I wrote it off my taxes.

 

[rszappa1]

This whole think was a shame by the Gov. They new that bankrupsy was going to happen at the begining....

 

[rszappa1]

GM will be next....

 

[ADFD1]

What a mess for the tax payers. GM will follow, and anyone else who flounders after they borrowed our money. What did uncle Sam actually think was going to happen? I see a chain reaction coming. Uncle Sam has to get money into the hands of people so they can start spending it.

 

[rszappa1]

Obama knew this from the begining and the rest of his staff.....

 

[Gary Allan]

Time to pay for the party...


How did they say it to the kid in Young Guns when they shot him off of the horse? Time to take your medicine.

Don't curse what is occurring NOW. Stone those who made this look like a solution.

 

[Cutehumor]

Where are all Chrysler folks who said that Chrysler paid their bailout money back in the 80s and they will repay this bailout money back??

 

[rszappa1]

Lee I coka cola would not be happy..

 

[PandaBear]

Originally Posted By: rszappa1
Obama knew this from the begining and the rest of his staff.....
And so do our Mr. W.

 

[mstrjon32]

I'd rather see it go to the so-called evil "unions" than see $700 billion go to a bunch of greedy, lying [censored] on wall street. I have no problem supporting the working class people of this country, but I'd certainly love to see those finance idiots get the death penalty.

 

[Gary Allan]

Originally Posted By: mstrjon32
I'd rather see it go to the so-called evil "unions" than see $700 billion go to a bunch of greedy, lying [censored] on wall street. I have no problem supporting the working class people of this country, but I'd certainly love to see those finance idiots get the death penalty.

 

[Win]

In reorganization proceedings, creditors typically get an equity stake in the restructured company in lieu of payment. There is pretty much no other possible outcome (short of liquidation) because if a debtor had enough cash to pay debts as they became due, it wouldn't have been in bankruptcy to start with.

The real story here is that an unsecured creditor (the govt.) is trying to get in front of secured creditors.

It will be interesting to see whether the law, or politics, prevails.

 

[PandaBear]

Originally Posted By: mstrjon32
I'd rather see it go to the so-called evil "unions" than see $700 billion go to a bunch of greedy, lying [censored] on wall street. I have no problem supporting the working class people of this country, but I'd certainly love to see those finance idiots get the death penalty.


The problem is the greedy, lying [censored] on wall street already ran away with 700b and but have someone else holding a loan to that 700b.

The chain reaction from falling home price to SIV and CDS can really bring down anyone that relies on financing or debt for operations. AIG, the banks, FM&FM, the foreign government, etc.

CDS is what brings down Chrysler, as the debt/bond holders hedge against it and will do anything to get it to bankrupt and trigger a payout.

In the end I think we are going to recoup some of that 700b, not all but some, but I'm more worried about the national debt and inflation it results, more than the 700b loss.

 

[javacontour]

Originally Posted By: mstrjon32
I'd rather see it go to the so-called evil "unions" than see $700 billion go to a bunch of greedy, lying [censored] on wall street. I have no problem supporting the working class people of this country, but I'd certainly love to see those finance idiots get the death penalty.



Well except it's likely the majority of that money that is not being paid back isn't in the accounts of those greedy folks, but in pension funds and 401(k) accounts that guys like you and me have.

You may be happy to see the government give your money away. Frankly, the fund managers who voted against a settlement with Chrysler did vote to protect folks like you and me.

The greed I see here is the government bending the rules to get it's way at the expense of the citizenry.

Edited to Add: I'm not saying there is no benefit for the fund managers as well, I'm sure there is. However, far more "little people" will lose big if Chrysler is allowed to change the order of who get's paid in bankruptcy compared to what the law says is the order.

Fund managers made decisions to buy bonds on behalf of pension funds and workers chose bonds in their 401(k) for the same reason, they are paid FIRST in bankruptcy.

If this is allowed to change at the whim of the government trying to protect one business, then everyone's retirement is at an even greater risk than when this crisis began.