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Chrysler's Greedy Hedge Fund Holdouts Get It Right: Ann Woolner

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posted on May, 6 2009 @ 12:46 PM
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Chrysler's Greedy Hedge Fund Holdouts Get It Right: Ann Woolner


www.bloomberg.com

May 6 (Bloomberg) -- You can call the plan to merge Chrysler and Fiat good for the economy. You can think it creative.

You can say it’s the start of “a vibrant new company,” as Chrysler LLC Chairman Robert Nardelli did last week.

But there’s one word that you can’t call the Chrysler bankruptcy package: legal.
(visit the link for the full news article)




posted on May, 6 2009 @ 12:46 PM
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This is an article from Bloomberg News that describes how the President is blatantly breaking the bankruptcy code, the US Constitution, and pressuring a Judge to do the same.

This commentary cites to a number of a number of legal scholars, and they all say the same thing, that this Chrysler deal is illegal, and sets a very bad precedent for the future of property rights in this country.



The dissidents say the sale is nothing more than what bankruptcy law calls a sub rosa reorganization, a secret reordering dressed up to look like a sale, which the law forbids.

Plus, would it even be a true sale?

In public statements Chrysler says a United Auto Workers health benefits trust would get 55 percent of the shares of New Chrysler and a $4.6 billion note to satisfy some of the group’s unsecured claims against the company.

Paying nothing but offering its fuel-efficiency expertise, Fiat SpA would own 20 percent initially and could increase its stake by another 15 percent. The U.S. and Canadian governments, which are providing billions in interim financing, would own the rest.

Phony Sale

Chrysler is essentially selling itself to itself, says Lynn LoPucki, a law professor at the University of California, Los Angeles. He teaches secured transactions and maintains a database of major bankruptcies.


What they are doing is screwing the secured creditors - the ones who kept Chysler out of bankruptcy when Mercedes walked away - and taking care of unsecured creditors, i.e. the Union.

This is like Obama forcing you into foreclosure on your home, except instead of paying the bank that gave you the mortgage with the proceeds of the sale, he is paying the credit cards that you used to buy plasmas and expensive meals at restuarants.



Already the Chrysler case is one for the books. You have the federal government sending a company into bankruptcy court, financing its reorganization, deciding who will get what, setting a strict timetable and urging a judge to blink at the law.

If the argument that Chrysler’s welfare is so critical to the national interest that longstanding laws can be ignored, what’s next?

Some future president will find a way to justify blatantly illegal conduct. Such as torture.


Obviously torture is bad, but if it saved thousands of lives after 9/11, is that as bad of stealing from the private individuals, using our tax dollars, to save the autoworker's UNION?

Remember, Fiats are built in places like Italy, Brazil, Eastern Europe, not Detroit. This won’t save jobs, only line the pockets of the people in charge of the unions.

www.bloomberg.com
(visit the link for the full news article)

[edit on 6-5-2009 by finemanm]

[edit on 6-5-2009 by finemanm]



posted on May, 6 2009 @ 01:24 PM
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I am at a loss for words....

If this is a sub rosa reorganization, and the federal and local governments and collective bargaining units are complicit, this is a conspiracy of a high order. After all, there are already signs of misrepresentation to the press, and taxpayers who are footing the bill to hold this company up while they carry out there latest scam.

Where is the Justice department in all this? Asleep?

Are there no scholars of law that merit enough attention to deconstruct the myth around this 'mythical' sale?



posted on May, 6 2009 @ 03:20 PM
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reply to post by Maxmars
 


The problem with waiting for the Justice Department is that the head of that governmental body is Eric Holder, and his boss - Mr. Obama - is a the top of this conspiracy.

The Obama Adminstration is buying Chrysler with our Tax dollars in order to give the vast majority of the company to the UAW, and a major minority stake to a forign company - who is not being asked to put up any money.

The reason they are getting away with this fraud on the American Public is that no one seems to care. Look at this thread. It is getting almost no interest while the Swine Flu threads are being bombarded.

Don't get me wrong, Swine Flu is a scary thing, but what this government is doing with our money is MUCH scarier. It started with Bush and Paulson, but it has continued with Obama and Geithner. This country is slowly becoming a Fascist state.

The Lenders that are fighting this Chrysler deal are getting death threats because the President blamed them for putting Chrysler into bankruptcy.

Chrysler is in bankruptcy because they are a horrible company. On a personal note, I leased a new car last summer. I was looking for a car when the gas prices were over $5 a gallon, so I went to Chrysler as they were offering to guarantee gas at $2.99 a gallon.

I recently had a child with my wife, so I wanted an SUV. I checked out a Chrysler Aspen. After test driving that piece of fecal matter, I decided that there was almost no way I was going to submit myself to that type of torment for three years. I sat down with the dealer anyway, and when he quoted me a price of over $850 a month, I stated to walk out and dealer told me he could do it for $550 a month. He dropped the price by $300 month simply by standing up.

I ended up leasing a Mercedes Benz ML 350 for $650 a month, that’s just $100 dollars more than the bottom line on the Chrysler Crapspen, and I drive a beautiful car built in ALABAMA!

[edit on 6-5-2009 by finemanm]



posted on May, 6 2009 @ 03:30 PM
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reply to post by finemanm
 



I ended up leasing a Mercedes Benz ML 350 for $650 a month, that’s just $100 dollars more than the bottom line on the Chrysler Crapspen, and I drive a beautiful car built in ALABAMA!


Agreed! I drive a beautiful Toyota built in Kentucky!


Chrysler & GM and their union masters can go to hell as far as I care.



posted on May, 6 2009 @ 03:57 PM
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reply to post by Ferris.Bueller.II
 


I know, if MB, Toyota, Honda, Nissan, Infinity, Acura, Lexus, and BMW can all build great cars here with Americans in the factories, why can't Ford, GM and Chrysler build a decent car.

Simple answer, the Unions are holding the companies hostage. I have read numerous times that GM is the world's largest HMO and pension plan that also builds cars on the side.

Now Chrysler is owned by the very people who are responsible for bringing it to its knees.

Unions play an important role to guarantee fair treatment of employees, but when they become bureaucracies of their own, they become a real problem.



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