GM borrows $4 billion more, prepares for bankruptcy

[fdjizm]

Originally Posted by Super83Z

Are you really that upset over 15.4 billion, especially when the banks got 700 Billion that will never ever get paid back?

i'm sorry when is the last time you heard of people getting LOANS and driving off scott free from paying them? yes i am upset at the banks as well if they arent paying back,, might as well call it a handout not a LOAN.

[DeathChill]

Originally Posted by Super83Z

Are you really that upset over 15.4 billion, especially when the banks got 700 Billion that will never ever get paid back?

The banks are paying them back and many banks have already begun paying them back.

As well, the banks are the backbone of the entire business world; two failing car companies, not so much.

It's irritating that both Chrysler and GM get off scott-free but I can understand the rationale behind it because emerging out of bankruptcy with $10+ billion in debt defeats the purpose of a bankruptcy.

As for the unions getting a stake: that's for their retirement fund, no? It's supposed to cover paying for all the retirements so GM doesn't have to.

[carfansince73]

Originally Posted by Super83Z

No, no its not. "Bad GM" will go to court and be sold off. "Good GM" will not and will restructure in 30-60 days then reopen. So its not your typical bankruptcy. A typical bankruptcy would have all of it go into court and EVERYTHING sold off.

There are different types of bankruptcy, and I'm no expert but I think you are talking about chapter 7 where the company would be liquidated and sold off leaving nothing. GM would likely go into chapter 11, which I think means they would have a court renegotiate their debts to their creditors and also get additional concessions from workers. Their contracts would be history too. Those holding secure debts, like the bondholders for example, would get first dibs leaving those non-secured, like the unions, last. This happens frequently with the airlines being some of the biggest companies filing ch 11, reorganizing, and then emerging from bankruptcy.

[Super83Z]

Originally Posted by carfansince73

There are different types of bankruptcy, and I'm no expert but I think you are talking about chapter 7 where the company would be liquidated and sold off leaving nothing. GM would likely go into chapter 11, which I think means they would have a court renegotiate their debts to their creditors and also get additional concessions from workers. Their contracts would be history too. Those holding secure debts, like the bondholders for example, would get first dibs leaving those non-secured, like the unions, last. This happens frequently with the airlines being some of the biggest companies filing ch 11, reorganizing, and then emerging from bankruptcy.

Thanks I know what I am talking about. When you go to bankruptcy court the judge decide whether the company gets to reorganize (ch. 11) or get liquidated (ch. 7). In this case he/she will have no say. It all depends on equity the company has in what it owns vs. whatever debt it has. GM is like negative 60 billion in equity. IF this was a normal bankruptcy there wouldn't even be a hesitation in liquidation. Trust me I have been reading about this since last year. Mis-information runs rampant on this site.

[Hylton]

Originally Posted by Super83Z

No, no its not. "Bad GM" will go to court and be sold off. "Good GM" will not and will restructure in 30-60 days then reopen. So its not your typical bankruptcy. A typical bankruptcy would have all of it go into court and EVERYTHING sold off.

Yes they did discuss splitting the company into 2 seperate entities however, I do not believe they will actually be going forward with this. 1 more week before the big deadline and that is certainly not enough time to split the company into two.

[MerF]

Originally Posted by DeathChill

The banks are paying them back and many banks have already begun paying them back.

I believe you are mistaking paying them back in good faith and covering their asses. Remember when a couple of them got busted paying millions in bonuses? Once the others saw them getting busted they realized they couldn't pay themselves until they paid back a certain percentage to get gov't. THAT'S the paybacks you are seeing, not what you are thinking.

Originally Posted by DeathChill

As well, the banks are the backbone of the entire business world; two failing car companies, not so much.

If that were true, then the near trillion that was injected into the industry would have improved things. It didn't, because it's not a product. All the banks did was try to stem their losses on fake investments that they were being greedy with in the first place. In other words it did nothing to stimulate anything in the real world.

The Big 3 on the other hand are directly or in-directly responsible for millions of jobs and billions of local revenue for taxes because they produce a product. It could be argued that Nissan does more for our local economy than the banks do...at least they advertise and pay taxes.