http://dealbook.blogs.nytimes.com/2009/04/30/chrysler-lenders-fault-government-as-bankruptcy-looms/
Lenders Fault Treasury in Chrysler Bankruptcy
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the arguments are partial and not the whole truth…
the workers also take paycuts and reduction of benefits, not just a haircut on the pension liability conversion to equity…so it is a holistic balance of interests and rights…
commercial negotiation is always a matter of negotiation power..it does not matter whether it is the US Treasury or Warren Buffet…if Warren Buffet were to dish out new US$4b or US$7b loans, he will impose conditions he thinks is fair to all parties and it is just a matter of commercial negotiation to close the deal…why should US treasury be different?
if deal is not struck then the case goes to chapter 11 bankruptcy..what overturning rule of law and “outside the well established legal framework” is there?
it is just a failed negotiation with 90% agreed and just 10% holding out by non TARP lenders and if it si clear that these lenders will receive less in chapter 11 than if they had agreed so goverment is totally correct to say they are not acting in their own commercial interests…obviously the non TARP lenders are either in a game of brinksmanship or they believe they will get a better deal in bankruptcy…so lets just stay tuned…
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