businessinsider.com - 4/1/2009
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GM (GM) has 58 days to negotiate to convince bondholders to take a major haircut or debt-for-equity swap. But it doesn't sound like it's going to happen. Why not? Because the bondholders don't seem interested in taking the ridiculous haircut that would be necessary for GM to be viable. Why won't ...
online.wsj.com - 3/30/2009
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online.wsj.com —
Obama moved to impose sweeping and hard-nosed restructuring
measures on GM and Chrysler, including the ouster of
GM's Wagoner.
(more)
U.S. Forces Out GM CEO Wagoner
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How bailing out AIG dooms General Motors
TigerHawk —
Anybody out there want to disagree with this ? GM (GM) has 58 days to negotiate to convince bondholders to take a major haircut or debt-for-equity swap. But it doesn't sound like it's going to happen. Why not? Because the bondholders don't seem interested in taking the ridiculous haircut that would be necessary for GM to be viable. Why won't they take this haircut? Because many of the same bondholders presumably own credit default swaps on GM debt with AIG. And the US government has already made clear that it will cover those CDS's at 100 cents on the dollar. In other words, ...
General Motors And AIG
Wizbang —
... a bankruptcy filing but that fact, in and of itself, is not startling. Bondholders have known this for months. However, there is an interesting twist to the story about these bonds and other GM debt obligations held by large US financial institutions. Many of these bond holdings have been insured against default, which means that the bondholders, in the event GM goes bust, will collect their money anyway because they have insurance to protect them from loss. Guess which company probably wrote most of that insurance ? That's right, AIG. So now tax payers are presented with the ...
Do We Hate Credit Default Swaps for The Wrong Reasons?
Megan McArdle —
... Note that this has been alleged before,
though previously with GM's ongoing failure to get its bondholders to
exchange debt for equity. Now those involved in actual bankruptcies are
citing it as a problem. ...
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