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Thomas Hawk
"Make no mistake. We are selling off our future and the future of our children to prevent the bondholders of US financial corporations from taking losses. We are using public funds to protect bondholders of some of the most mismanaged companies in the history of capitalism, instead of allowing them to take losses that should have been their own."
April 30
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Mrsth, Kate, Russellreno and 22 other people liked this
quote by John Hussman.
- Thomas Hawk
Welcome to the financial idealism of the 20'th century
- Wizetux
Some of the bondholders are us. That is, pension funds and other institutions that purchase on behalf of many people. Just sayin'...
- Kevin Pedraja
John's always a pretty insightful guy and I'm afraid he's right on the mark with this one.
- Thomas Hawk
The GM bondholders are taking a huge haircut. They are getting 10% of the company in exchange for their $27 billion in bonds. The UAW is getting 40% in exchange for $10 billion. The gov't would get the remaining 50% for $10 billion in loan forgiveness.
- Brian Newman
The GM bond holders won't accept this deal.
- Thomas Hawk
What will GM bond holders do then Thomas?
- Brian Sullivan
True. They would get more if GM went through a true bankruptcy than if they accepted GM's restructuring plan so they have no reason to accept.
- Brian Newman
Aren't several banks trying to repay TARP money that the Government won't accept?
- Robert Hafer
GM bondholders will try to renegotiate to get a better deal. No way they get 90% of the current bondholders to support this existing deal though. If they can't they might just let it go into liquidation. Not sure they'd fare much better there though.
- Thomas Hawk
full article from Hussman: http://www.hussman.net/wmc...
- Thomas Hawk
"We simply cannot make these bad investments whole unless we are willing to hand the next 10-20 years of U.S. private savings over to the bondholders who financed reckless lending. Those bondholders should, and ultimately must, take a portion of these losses, and debt obligations will have to be restructured. Wall Street has become a bunch of Tooter Turtles crying “Help, Mr. Wizard!” because it got so used to Greenspan bailing everybody out. But that constant attempt to avoid inevitable private market losses is what allowed this problem to become so noxious. It will continue to do so until we collectively scream loud enough for Congress to say on our behalf, “Enough.”"
- Thomas Hawk
Although selling the future is what we do all the time - by polluting and encouraging companies to pollute and overuse the commons, by consuming non sustainably and encouraging companies to produce and work non sustainably, by letting rainforests and species disappear, by creating political instability when it suits our business interests. What's a bit of debt on top of that?
- Joelle Nebbe (iphigenie)