Time to make a bowl of popcorn - GM headed for bankruptcy?
From
The Washington Free Beacon:
Bailout on the Brink
A New York federal judge may rule imminently on a case that could reverse the General Motors (GM) bailout and send the company back into bankruptcy, according to sources close to the case.
At issue is a backroom deal hatched by GM to fulfill the Obama administration�s demand for a quick bankruptcy, draining the automaker of nearly all of its cash on hand and leaving it in worse shape than it was when it collapsed in 2009.
The case is pretty cut and dried -- a bit more:
All of that could be reversed if bankruptcy Judge Robert Gerber reopens the process and rules in favor of old GM trustees, who are suing the hedge funds at the center of the lockout agreement.
It seems that the Obama administration and the management of GM were not quite forthright when Gerber oversaw the initial bailout:
Gerber, the federal judge who initially approved the sale with little hesitation, now has the power to reverse the entire auto bailout. He has expressed deep frustration with the company for failing to disclose the deal, leading some to speculate that he may overturn one of President Barack Obama�s signature achievements.
�When I approved the sale agreement and entered the sale approval order I mistakenly thought that I was merely saving GM, the supply chain, and about a million jobs. It never once occurred to me, and nobody bothered to disclose, that amongst all of the assigned contracts was this lock-up agreement, if indeed it was assigned at all,� Gerber said in July.
At heart, it was never about bailing out GM, it was about bailing out the UAW. GM's bondholders got screwed over bad. The only bright side is that a lot of UAW pension funds were being held in GM bonds...
A I said in a post on
April 27th 2010:
I have been a General Motors driver since the 1970's.
My last truck was about 12 years old and was close to 200 thousand miles.
I recently purchased its replacement.
Note the pretty blue oval logo�
Picked her up on April 13th, 2010 -- 2008 vintage with 20K miles. She just ticked over the 100K mark with only one mechanical problem -- the radiator blew out. Looking forward to the next couple hundred K miles -- I love this truck and am a dedicated Ford driver from now on.
Posted by DaveH at December 6, 2012 6:37 PM