Saturday, May 2, 2009

White House uses strong arm tactics to extort concessions from lenders

Update May 5, 2:00PM EDT. I notice many of you are Googling for more information on the Chrysler/government bankruptcy situation, and especially the court challenge led by Tom Lauria. I am not a legal expert and I hesitate to be the source of up to date news on the subject. For a better appreciation for what is happening, go to The Truth about Cars website. They have very current analyses of what is going on.

Yesterday (May 1) on Detroit’s Frank Beckman’s morning talk show (WJR), bankruptcy attorney Tom Lauria made the incendiary accusation that the members of the White House had threatened to use the “the full force of the White House Press Corps to destroy” his client’s reputation if it didn’t acquiesce to highly unfavorable terms of the government’s proposed Chrysler restructuring plan. Because of the strongarm tactics, Lauria’s client dropped its opposition.

Here is the tape of Beckman’s interview of Lauria. The relevant portions begin at the 1:30 mark. Listen to it.

Lauria: Let me tell you it’s no fun standing on this side of the fence opposing the President of the United States. In fact, let me just say, people have asked me who I represent. That’s a moving target. I can tell you for sure that I represent one less investor today than I represented yesterday. One of my clients was directly threatened by the White House and in essence compelled to withdraw its opposition to the deal under the threat that the full force of the White House Press Corps would destroy its reputation if it continued to fight. That’s how hard it is to stand on this side of the fence.
Beckman: Was that Perella Weinberg?
Lauria: That was Perella Weinberg.

There is a pattern here. Financial institutions holding billions of Chrysler’s secured debt are being held hostage by the TARP loans they are not permitted to pay back. They are being forced to accept just pennies on the dollar for loans they made in good faith less than two years ago. Just like mob loan sharks, the administration wants them under its thumb so they can extort more and more concessions. This is an abuse of power that goes beyond Nixon.

74 comments:

Larry said...

This is like Luka Brazzi and Don Corleone "your brains or your signature on that contract...."

maxx said...

Does this mean the White House controls our supposedly free and unbised press?

The answer is Yes, but only because the press has chosen to be minions instead of watchdogs.

K T Cat said...

It's interesting that he is confident that the White House press corps is a credible threat on his behalf.

grinder said...

Poor Perella Whineberg! Boo hoo! This is what you call "risk," children. When you buy and hold bonds, it's your job to assess default risk. Perella Whineberg took a gamble, and lost.

Now face the music. It's what millions of other people have had to do. You want our sympathy for not having squeezed millions of bucks out of this situation? Go to hell, whiners.

Oh, the the White House "threatened" you. What was the nature of this "threat?" From your pitiful whine, it seems aas if someone at the White House told you that they'd stand up in front of the TV cameras and call you out for being the selfish, whining, crybabies that you are.

Waaaaaaaaaaaaaah!

Corky Boyd said...

Grinder

Perella Wineberg owns secured paper, secured by assets of Chrysler. By law they are are entitled to those assets. That is unless thugs can intimidate them into relinquishing their legal rights.

This is what is happening here.

ted said...

grinder,

You must be a liberal because you are brain dead.

To think that the President of the US would threaten you over a business deal should be factored in as part of a 'risk' is so far over the pale as to be unfathomable to an intelligent person.

Go back to your Kool-Aid stand.

Placeholder said...
This comment has been removed by the author.
juangalt said...

grinder,

is the definition of force majeure now "by act of God or Obama"?

as a risk manager, can you help quantity and mitigate that risk?

secured debt is just that, secured by hard assets. unilaterally changing a contract creates more problems then it solves.

to put it in terms you can understand - what if someone ordered large fries at your drive thru, but gave you a hunk of play doh instead of the $1.94 - how long would you stay employed on the late night shift?

erp said...

I forget, just what was it that Nixon did to abuse power?

Taped conversations? FDR did it too. Nobody cared.

Took money from questionable sources? If that's criminal then Obama should be impeached STAT. That's his MO.

Break into a Watergate office? Obama's goons broke into confidential state records to find out Joe, the Plumber, didn't have anything illegal in his background.

Lots more. The One rides above it all, while the media and Chicago gangland operatives are turning our country into Soviet state.

grinder said...

If Perella Whineberg has "legal rights" to the money, then let 'em go to court and force Chrysler into Chapter 7. Let's see what they get then. Poor babies think think they're going to take the taxpayers to the cleaners, then turn right around and whine some more about "the socialists."

You do have to admire the chutzpah, but I'm afraid it ran into a steel wall this time. Boo hoo kiddies! Gosh, you mean Uncle Sucker doesn't hand out lollipops to everyone? Waaaaaaaaaaaaaaah!

One other thing: Insult me, and insult Obama all you want. But the whiners aren't going to get any more money. They gambled on their bond position and they lost. Usually, in the investment world, losers slink off into their corner, a little ashamed of themselves for having made a bad bet.

Not Perella Whineberg. Oh, no. That pack of losers actually thinks they can parade their bad bet through the streets and get sympathy for it. Waaaaaaaaaaaaaaaah!

grinder said...

By the way, this ought to be quite the cause celebre for the right wing out there in America. I can see it now: "To the barricades for the hedge fund of Perella Whineberg!" Has a real nice ring to it. Fools! Waaaaaaaaaaaaaaaaah!

grinder said...

In a popularity contest between swine flu and Perella Whineberg, the winner isn't apparent. This is probably what that evil minion at the White House told the whiners. Sounds like some people were walked right to the edge of a cliff, and invited to look down. Waaaaaaaaaaaaaah!

Jason said...

Grinder is typical of the sour breed of liberals who now infest blog and forum comments...as dumb as a rock and insufferably childish. To use "waaaaaah" once in a blog comment is bad enough but I have counted FOUR so far from the infantile Grinder. Are we to assume that Spongebob Squarepants is temporarily off the air?

Hawk said...

Actions have consequences. Good luck to the Big three getting anyone to but their bonds now. I wouldn't touch their paper with a 10 foot pole. Investors take heed, do not do business with anyone that the government controls or may soon control.

George said...

"To the barricades for the hedge fund of Perella Whineberg!"

Today it is this investor, tomorrow it will be your coffee shop.

It is called the right to property and is just as important to our nation and freedom as your right to privacy, your right to a free press, your right to due process. You are on the side of the thugs and thieves.

Your parent's pension may have invested in these bonds because they were considered 'safe'. You demonstrate the typical ignorance and personality bent of the liberals. 'The investment institution is a 'guy' that we can deomonize.' No principles, no law, no abstractional thought, just doodling in a mental comic book.

Robohobo said...

George - I love that, . . . "just doodling in a mental comic book."

Can I use it?

Here is what we have to do:
Wait until The 0bamanation has enough wrongs in his ledger that they cannot be ignored then demand articles of impeachment. It should not take too long. We also must take back Congress in '10.

The modern version of going John Galt (and what I am going to be doing):
Sell all investments and put the money into real property in the country. Put up a small house and greenhouse for the depression garden. Find ways to survive outside of the cities.

The time to drop out is upon us. If they have no more productive citizens on the books then the Left will not have the revenues for their state changing plans.

Aindreas O Gallchoir said...

as creditors, they were asked to take a haircut and they refused. The administration has an onus to stabilise GM and chrysler. Their actions bear no comparison to the actions of the Nixon administration. This is nothing more than childish, petulant, self centered hyperbole on your part.

Corky Boyd said...

Aindreas

Being asked to take a haircut is a far cry from threatening to call the White House Press Corps to destroy your business. We already seen this kind of intimidation of AIG fomented by the White House and the media.

Obama, when he had his meetin with the bankers at the White House, arrogantly delclared he was the only person between them and the pitchfork armed mob.

There is no place in a civilized society for a government to take this attitude.

It is simply wrong whether it's Nixon or Obama.

Aindreas O Gallchoir said...

no. refusing to take a haircut and then being told that the press would likely land on you like a ton of bricks is eminently logical. they landed on AIG like ton of bricks with no involvement from the whitehouse. its also notable that nowhere in his statements did Obama name the hedge funds and investment groups involved.

Again: please stop comparing the actions of a highly transparent administration, one that is trying to keep the economy together, to the nixon administration. It is a jaw droppingly inane comparison.

grinder said...
This comment has been removed by the author.
grinder said...

Today it is this investor, tomorrow it will be your coffee shop.<>

You don't even believe that. This was a difference between taking 50 cents on the dollar and 29 cents on the dollar. Perella Whineberg wanted more, and the government said no. "Your coffee shop" has nothing to do with it, you condescending idiot.

It is called the right to property and is just as important to our nation and freedom as your right to privacy, your right to a free press, your right to due process.<>

Behold the self-righteous, whining bondholder! As a bondholder, Perella Whineberg acted as a lender. This was a loan gone bad, and now they wanted even more money from Uncle Sucker. They should be grateful they got anything at all, the greedy whiners.

You are on the side of the thugs and thieves.<>

Oh really! You want the American taxpayer to bail out yet another whining New York bank? Screw you!

Your parent's pension may have invested in these bonds because they were considered 'safe'.<>

Well, then my late father's pension fund managers should be fired, because anyone who thought Chrysler bonds were "safe" should have their idiot heads examined. Bottom line is the Perella Whineberg made a bad bet and now they're running around blaming everyone but themselves. What a bunch of squirrels!

You demonstrate the typical ignorance and personality bent of the liberals. 'The investment institution is a 'guy' that we can deomonize.' No principles, no law, no abstractional thought, just doodling in a mental comic book.<>

Where is this "personal responsibility" that you greedy, grasping, self-entitled, self-righteous, irresponsible, leeching, arrogant right wing ratf***ers are always talking about? Perella Whineberg made a bad speculation. I haven't seen any of them step up to the plate and accept responsibility for their rotten judgment.

Seems to me that "personal responsibility" has always been some slogan the rich throw at everyone else to intimidate them into blaming themselves. But when it comes to the rich, they sit there and whine about "the socialists" instead of looking at the stupid idiot in the mirror. Waaaaaaaaaaaaaah!

Corky Boyd said...

Aindreas

Threatening to destroy a business for financial advantage is illegal in every state and under Federal Law, whether done transparently or not.

Hopefully Judge Gonzalez will call in all the bondholders and determine if there has been intimidation. We still live by the rule of law. The case is now where it should be, being decided by an independent judiciary.

grinder said...

Being asked to take a haircut is a far cry from threatening to call the White House Press Corps to destroy your business.<>

No one knows exactly what, if anything, was said on that subject. All we have is a statement from some right-wing whiner on a talk show. All anyone can do is speculate.

But if such a conversation did take place, I sure as hell hope there was some sort of threat by the White House. It's about time they stared down some of these greedy, arrogant bastards.

I can only hope there will be some more stare downs. And once the worst of this financial crisis has passed, I can only hope that there will be a bunch of New York bankers in jail, and then the reimposition of regulations that are so tight you can hear the squeaks and squeals in Milwaukee.

Aindreas O Gallchoir said...

mmmm. telling someone that one of the consequences of a highly selfish position will likely be genuine harm done to their public reputation, seems a ways away from quote 'destroying the company'. I'm calling hyperbole there.

Still as you say - co-equal branches; its with the judiciary now. Its notable that 90% of the creditors have an agreed position walking in. Your boys in the rump are unlikely to receive much love, or a better deal there. This should prove instructive for the GM creditors no?

pal ashford said...

Oh Noes! Why is the White House being so mean to the nice businessman?

Here’s the reason: The client who is being strong-armed is hedge-fund manager Perella Weinberg Partners LLP. Perella and a couple of other hedge funds that owned a part of Chrysler’s debt have been obstructing Chrysler’s attempts to restructure itself and avoid bankruptcy. The hedge funders wanted Chrysler liquidated so they could take their money, and too bad if the loss of Chrysler sets off a chain reaction of failed suppliers and other businesses that send the entire American economy into a tailspin. Not to mention what would happen to the retirees, who would lose their pensions, etc.

Lisa Lerer at The Politico explains what happened.

“Bankruptcy is only required today because of the greed of a few hedge funds that held a fraction of Chrysler’s debt,” said Rep. Candice Miller, (R-Mich.) “President Obama today stated that he did not stand with these hedge funds and neither do I.”…

…“The administration put a great deal of pressure on those entities to go forward,” said Rep. Gary Peters, (D-Mich.) “They gave these hedge funds every single possible opportunity to accept the deal.”

Last night, the Treasury department sweetened their $2 billion cash offer to holders of Chrysler’s secured debt by $250 million. The secured debt holders would have gotten the cash in exchange for retiring roughly $6.9 billion in debt. The administration also extended an original 6pm deadline to continue negotiating through the night.

Sen. Debbie Stabenow, (D-Mich.) blamed the breakdown in negotiations on three large hedge funds – Oppenheimer Funds, Perella Weinberg Partners and Stairway Capital.

“We’ve been working with them every day, last night, and up until this morning,” said Stabenow. “They pushed as hard as they could.”

The White House strong-armed Perella Weinberg Partners into signing on to the $2 billion deal in order to leave something left of Chrysler to restructure. This in turn will, it is hoped, save thousands of jobs (you’re saving not just Chrysler, remember, but also suppliers) and at least some portion of employee health and retiree benefits. And this is good not just for the employees and retirees, but for the state and local economies in which these businesses are located.

In other words, three hedge funds tried to hold a chunk of our nation’s economy hostage, and the White House didn’t let them get away with it. And this meathead blogger says the White House is abusing power. Jeez louise, people are stupid.

pal ashford said...

Pity the poor hedge fund!!!

grinder said...

There is an interesting discussion of this on a different blog, called "Zero Hedge." In this posting, the blogger takes the usual self-righteous right wing point of view, and then he is utterly taken apart by a commenter, "LFR," who speaks from experience in restructurings and just demolishes the wingnut whining.

Whineberg Perella, Oppenheimer, and Stairstep Capital, go to hell you pathetic losers! Accept responsibility for your own failure!

bruce said...

Great post Gallchoir! This has nothing to do with Nixon or any non-transparent problems. This Weinberg person doesn't get to request all this extra money from the government - it isn't fair for them to do that. I can't understand how ANYONE is defending this rich banker types, they are just another person asking for a bailout from the government.

And Obama is doing them a FAVOR by pointing out that the white house press corps almost entirely agree with him. Any rich lenders that try to screw the little guy over will get called out by a press which defends the little guy and his advocate in Washington (the Democratic party). This Weinberg person (and I think we can all guess his religion ethnicity based on his name!) gets no sympathy from me. I hope this serves as an example to other Bankers when they think about getting in the way of a president who is trying to bring real change to this country!

Oh yeah - Obama 2012!

Devin said...

Grinder,

Busy day, eh?

"It's about time they stared down some of these greedy, arrogant bastards. "

Hope you think the same about ALL bailouts over the last 18 months. What did you get with your gov't check?



----
Pal Ashford:
"The hedge funders wanted Chrysler liquidated so they could take their money, and too bad if the loss of Chrysler sets off a chain reaction of failed suppliers and other businesses that send the entire American economy into a tailspin."

Wrong! A failed auto industry would have provided unprecedented opportunities for those who are FAR more adept at deploying capital in efficient and productive ways.

But, Waaaaaaaaaaaaaah!, the union's and their D.C. thugs made sure that the small car companies currently within the US are denied the capital and talent that would have been rattled out from the industries failure. Instead, I and my kids future labor has been confiscated, at gunpoint, in order to protect non-productive looters within the industry.

DC screwed our future by trying to save the failed industry. If the auto industry failed, in 10 years new American companies would be the leaders in car production and innovation. Now, where do you think the car industry will be in 10 years.

Try freedom, unless your scared.

grinder said...

Devin, if you want to argue against bailing out Chrysler or GM, I'd respect that. Frankly, it's obvious that there's not enough room for three U.S. car companies, and that at least one of them has to go.

But that's not what this little tempest is about. Perella Whineberg isn't contesting the bailout. It and two other hedge funds want a bigger slice of the pie. That's what is at issue here: a failed bondholder who wants to suck at the government's teat. Nothing more.

Bill Dalasio said...

"Perella Whineberg has "legal rights" to the money, then let 'em go to court and force Chrysler into Chapter 7."

That's precisely what they were going to do before the goons from the administration pulled them aside and told them: "If this goes to court, we're gonna rough you up shee!! Myeah myeah!!"

Scott said...

Grinder doesn't quite grasp how it works so let's break out the paper and crayons and explain, shall we?

The firm put up their own capital and have signed agreements that hold the weight of law. Yes, there was risk as there is in any business venture.

However, that risk was never imagined to come from the government. the form expected 1.00+ on the dollar because it wouldn't make a whole bunch of sense to enter into an agreement where you received a fraction of a dollar back. Are you following this scrub or am I moving too fast?

Now the $100,000 question. How many people will invest in American firms if the government can strong-arm them into receiving less than they invested? Capital dries up, losses increase, jobs are lost in huge numbers and the money men go to less socialized countries to do business like Germany, China, Cuba or Venezuela.

Becky said...

I don't think I would want to lend grinder any money,or anything else for that matter. It seems there is some confusion about the fund that owns Chrysler and the funds that loaned Chrysler money. It seems like the logic of the arguments here, suggest some posters do not understand fully the concepts of stocks, bonds and contract law that they are trying to argue about.

By the way, the president has identified the lack of credit in the financial crisis, and people who invest in bonds, actually are providing credit to companies and governmental bodies. If the president can call Chrysler's bondholders greedy and non sacrificial, does this set a precedent for demanding sacrifice from US bond holders in the future? Just a thought of where the difference would be. US debt on the world market is experiencing a few problems, so this case may be more than of national interest.

Aindreas O Gallchoir said...

scott, its common in bankruptcy proceedings for the creditor to get a fraction of the total debt owed to them. By being the few who refused to compromise in a difficult situation, these parties have forced GM into bankruptcy, partly because any losses they make as a result of the bankruptcy they are indemnified against by AIG. the financial system nearly fell over: they are businessmen, but they are citizens of the republic also. they should be ashamed of their conduct. Most of America is.

bruce said...

Island turtle, or wing nut seashell?

Not only are these lenders greedy as h*ll, they were expecting to get money from AIG as well. So they're "secured creditors" - secured by AIG! Scum of the earth.

grinder said...

Hey Becky, other than credit cards that I pay in full every month, I don't have any debt. My $750,000 house (peaked at >$900K, but you know how that is), is mine, free 'n clear. So you don't have to worry about lending me money. I never went in for usury.

Scott, here's now it works. Let me break out the crayons for you. When you buy a company's securities, you make a decision about risk. With bonds, the risks are inflation and default. Perella Whineberg misjudged the risks, and now they are whining.

Perella Whineberg, and its two fellow whining hedge funds, don't want to take 29 cents on the dollar. They want 50 cents on the dollar. They thought they'd strongarm the feds into giving them what they wanted, but the feds told 'em no. And now they keep whining.

Let 'em go into bankruptcy court as a holdout and see what happens. Of course, like most whiners, Perella Whineberg is too cowardly for that. So they signed off on the deal, and went their lawyer out to whine some more.

We're supposed to feel sorry for these imcompetent risk managers? We're supposed to think that because some pack of self-righteous, greedy, Republican billionares got 29 cents on the dollar that the world's going to end?

What planet are you idiots living on? And Becky, no one's going to stop risking their money in America. Hopefully, though, they won't be as incompetent as Perella Whineberg, and if they lose a bet they will have a little more class than Perella Whineberg. That's what really sticks out here. Those whiners ought to be ashamed to show their loser faces, but instead they choose to brazen it out and place the blame on someone else.

I guess it's the Republican Way, huh?

bruce said...

Well said, grinder. These people lost a bet, now they want uncle sam to pay. These rich wall street Republicans need to figure out the era of bailouts is over. Hey Wallstreet: Democrats are in power now, time to take some responsibility. We're done bailing out Republican voting cronies.

Scott said...

OK Grinder, you say you have a house worth $750K. We'll take you at your word. But what if you were only to receive $300K of the $750K at sale, even though you put up your own capital?

That's essentially what's happening. The gov is saying that we don't give a damn what you put up, you're rich. You will take our offer or we will sic the press on you and destroy you.

I can't believe that anyone who professes to make enough to afford a home worth $750K would be okay with that. You're either lying about what you own or you make your money in a fashion that involves no contracts.

Gene Alexander said...

Good post and very interesting to see from your comments that the left wing has no respect for the rule of law at all anymore. The UAW better hope the administration stops driving Saabs and Beemers 'cause no-one left of center will ever drive a GM or Chrysler again.

grinder said...

I do have a house worth $750K, and based on what things are selling for in my neighborhood, it's probably a conservative estimate. If you don't want to believe me, fine.

If I were to go bankrupt (fat chance), and there wasn't a private lender willing to step in and provide Chapter 13 personal reorganization financing, and at a result some government entity did so, then I'd be at the mercy of that entity.

That's the situation with Chrysler. No one will provide debtor in possession financing for their bankruptcy, so the government is doing it. The holdout creditors could have chosen to continue holding out, and gone to bankruptcy court in hopes of a) getting more money, at the expense of other creditors, or b) force Chrysler into Chapter 7.

We don't know what anyone in the White House actually told Perella Whineberg, but it would neither surprise nor disappoint me if someone said to them something like: "If you do this, and force a Chapter 7 liquidation of Chrysler, we will not mince any words about exactly who forced the company to cease operations, and why."

It could be that Perella Whineberg (and its fellow holdouts, Oppenheimer and Stairstep Capital) would have wound up in that court and found themselves crammed down to 29 cents on the dollar anyway. Bankruptcy courts have the power to take such steps, and in fact they do it all the time.

So, Perella Whineberg capitulated. Which is all fine and good. Think of a baseball game. When the batter crowds the box, sometimes the pitcher will throw one or two fastballs high and inside. P. Whineberg saw one coming straight at its head, and ducked. And rather than stay in the box and try for, say, a home run, they accepted a walk to first base.

The analogy isn't perfect, but unless you're a complete dolt you can get the picture. Now, in the major leagues, the guy who was walked to first base doesn't go whine about it. Unlike Perella Whineberg, he shows some class and takes what he could get.

I'd say that the arrogant parasites of Wall Street have yet to completely get the message that it's a new ballgame.

By the way, I don't notice any tears for the others in that restructuring that have taken some big haircuts. The only crocodile tears cried by the American wingnuts are for some billionaire Wall Sreet leeches who wanted another quarter-billion dollars. Speaks volumes about your crew. Well, guess what? McCain lost, and that's what happens when your side loses. Tough luck.

Matthew said...

Hmm, so let me ask you this, grinder. Just to see if you're truly this retarded:

People who enter into legally-binding contracts who demand what the contract be enforced are greedy whiners?

Union Workers who have extorted extravagent wages and benefits packages that bankrupt their employees are somehow morally superior when they demand the same?

And the government has the right to decide which contract can be enforced depending on what is politically expedient, and who it's political contributors and allies are?

Maybe they do it that way in Chicago, but this is still America.

Matthew said...

Beg your pardon;

That should have read:
"Union Workers who have extorted extravagent wages and benefits packages that bankrupt their EMPLOYERS are somehow morally superior when they demand the same?"

Devin said...

bruce:

"Not only are these lenders greedy as h*ll, they were expecting to get money from AIG as well. So they're "secured creditors" - secured by AIG! Scum of the earth."

Was it illegal? Was anyone forced, like _I_ was forced to bailout AIG? Did not AIG lose a bet?

Welcome to socialism, where corporate and union winners and losers are arbitrarily chosen as politicians work towards bigger and better popularity contests.

This goes FAR beyond party affiliation.

grinder said...

Matthew, you blind idiot, once an organization goes bankrupt, the court can rip up those contracts. This thing is what they call a "prepackaged bankruptcy," where the contractual issues are settled in advance of going to court. Prepackaged bankruptcies are common.

The unions are taking it in the shorts here. Big wage cuts, and benefit cuts will follow. Chrysler's dealer network is going to be decimated, and state franchise laws will be overridden because that's one of the things bankruptcy courts can also do.

Yeah, it sucks. It's what happens in bankruptcy. You have simply never paid attention until now. You don't know anything, so stop acting like you do.

grinder said...

p.s.: The reason the government was at the center of the prepackaged bankruptcy is because it is the provider of the DIP financing. If banks were willing to provide it, then they'd be in the Obama administration's position, knocking heads. Perella Whineberg was trying to shake down the feds for another quarter billion dollars, and the feds said no.

Nice trying, Perella Whineberg, but it didn't work. Now do what grown men do: Sit down, shut up, and show a little class, if you have any.

Pick said...

Not that it is impossible that this happened, I consider it hearsay. I am a conservative. He doesn't say who threatened them, and the exact wording the person used. Even if it *did* happen the way he said, I don't have much of a problem with the White House using their power to influence people. Even if it's a bluff, and even if it's something they could or would do.

Rich B said...

Grinder-

The bondholders had a right to argue for their interests in court. The mob tactics by the WH are an attempt to prevent that. Obama is a Chicago thug. That will never be clear to you - you're blind.

Hyphenated American said...

It's quite simple - Obama violated civil rights of businessmen. Of course, liberals hate businessmen, so they don't care for their civil rights.
Remember, first liberal fascists came for the businessmen.

Matthew said...

Grinder, let's take this one at a time, since I'm a blind idiot who doesn't know anything about bankruptcies.

a) True, a court can rip up a contract in a bankruptcy filing, but since Chrysler has not filed for a legal bankruptcy, no contracts have been ripped up. All existing contracts are still in force. Chrysler is not in bankruptcy; it's being forced into a shotgun marriage of convenience for the benefit of the unions by the Federal Government.

Quite frankly, in retrospect, had all the ailing companies like Chrysler, Citi and the rest, been permitted by the government to enter into Chapter 7, 11 or 13 bankruptcies, many of these outstanding issues might have been solved by now...without the need for government bailouts! Oh, forgot; there was an election going on then.

b) So what if the Union 'takes it in the shorts'? They drove Chrysler to it's emaciated state. Why should bondholders take a haircut without complaint, when the really greedy pigs won't? I've worked in the private sector all my life, have a degree, and work 80hours a week, and I don't get paid anything near what an autoworker does ($70/hour). Phuck the autoworkers; they've had it too good for too long. They killed the goose that laid their golden eggs, and want to blame someone else for it.

PGrossjr said...

Grinder, you obviously only know enough about bankruptcy law to be dangerous. Your argument can be summed up simply as "the ends justify the means", which is the siren call of all socialists.
I have taken companies through bankruptcy, there is no circumstance under which this whole scenario would unfold under a typical C11. Unfortunately, this is what happens when you let the public sector meddle in the private.
Oh and remember, it is better to remain silent and be thought a fool, then to open ones mouth and remove all doubt.

pal ashford said...

What you pea-brains aren’t noticing is that there are vast numbers of contracts that are being shredded or amended because of the plight of the automakers. These include contracts with suppliers and, probably, dealers as well as workers. Everybody else is taking a hit. The White House is trying to spread the pain around so that there’s something to salvage and the overall U.S. economy doesn’t take a bigger hit than it’s already taking.

In a perfect world the automakers would be making a profit and the capital investors would be making a nice return on their investment. But when the Titanic is going down it’s not the time to complain that you paid for a cabin with a better view and want a refund.

And, btw BRUCE - keep your antisemitic remarks to yourself. There are far more gentiles in the financial industry than Jews if you bothered to actually to take a tally. You can't pick and chose to demonize Jews for their over representation in the financial industry while ignoring their over representation in law, medicine, science, education and any other field they excel in.

grinder said...
This comment has been removed by the author.
grinder said...

The bondholders had a right to argue for their interests in court.<>

They still do, idiot. Perella Whineberg, the loser cowards, folded. They didn't have to do that. Nothing prevents them from standing up to the government. Companies have done that before, but Whineberg is too cowardly to try.

Obama violated civil rights of businessmen.<>

Exactly what "civil rights" were violated? The right to suck off the teat of the taxpayer?

Chrysler has not filed for a legal bankruptcy, no contracts have been ripped up. All existing contracts are still in force. Chrysler is not in bankruptcy; it's being forced into a shotgun marriage of convenience for the benefit of the unions by the Federal Government.<>

You must be just one more collegiate Republican hoping to get his first job out of college transcribing propaganda at the Heritage Foundation. Young child, there is a reason they call them "prepackaged" bankruptcies. Everything gets negotiated before the actual papers are filed. Good God, you are stupid.

No one4's "forcing" anyone into a shotgun marriage. Cerebrus Capital's property, Chrysler, is busted. If they weren't, none of this would be happening. If the "free market" could come up with DIP financing, the feds wouldn't be involved.

And if Chrysler went into Chapter 7, Perella Whineberg would get even less money.

I've worked in the private sector all my life, have a degree, and work 80hours a week, and I don't get paid anything near what an autoworker does ($70/hour).<>

You whining loser, the fact that you wait tables for a living is not my problem. By the way, the autoworkers don't make $70 an hour. That number is one more piece of Republican propaganda produced by including all retiree benefits in current autoworker pay.

There is utterly no lie you people won't tell.

Phuck the autoworkers; they've had it too good for too long. They killed the goose that laid their golden eggs, and want to blame someone else for it.<>

As soon as you zip up your favorite banker's fly, get back up off your knees, and wipe off your lips, you can look in the mirror and ponder the meaning of the words, "Phuck You."

grinder said...

there are vast numbers of contracts that are being shredded or amended because of the plight of the automakers. These include contracts with suppliers and, probably, dealers as well as workers<>

The dealer situation is huge. State franchising laws normally make it extremely expensive for an automaker to get rid of a dealer. In bankruptcy, those laws are tossed aside.

Notice that the banker butt-boys here say absolutely nothing on behalf of any other stakeholder except for Perella Whineberg, a pack of greedy billionaire parasites.

bruce said...

Great posts Grinder. I really enjoy your wit!

It wouldn't surprise me, if some of these Republican leaning types really are closet homosexuals - that seems to be a regular thing with Republicans (check out the movie "Outrage" if you don't believe me).

I agree, if Weinberg can't put up with a little hardball from the president of the US, I hardly see how they are fit for the business world where hardball is the only way it's played. I mean, fundamentally, these apologists for the rich money lenders, have yet to offer a reason why Weinberg should be due any greater payback than anyone else - did they buy a credit default swap from AIG?

I totally agree too, why even bother defending a rich banker unless you're thinking you'll get a job from them one day? As far as I'm concerned, anyone defending Wall Street has aligned themselves with Wall Street. Island Turtle, Devin and so on - stop defending these people and you'll be left alone. It's not that hard.

bruce said...

Just to be clear, I have nothing at all against gay people. A number of my friends are gay and they're great. I celebrate that lifestyle and their freedom to practice it. What I don't like, are hypocritical closet republican gays who spend every day whipping people into homophobia.

grinder said...

bruce, go to hell. I completely disassociate myself with your nutcase rantings about Jews and homosexuals.

Inalienable Rights said...

Grinder, you frighten me, because you lack reason, facts, humility, decency, and perspective.

Do you believe in the rule of law? Think carefully, because rule of law is a foundational concept for this nation. If law can be negated because you and Mr. Obama feel a lender is "greedy," then we have little left to continue to build this nation. Contracts become meaningless, subject to the whims of the bully in power. Presidential elections every 4 years? Gone. Your insurance policy? Worthless. Your 401K? Not worth the paper. The crops you just sold? Sorry, the money's not coming, you greedy farmer. The property you just bought for cash? Too bad, so sad, someone else took it and will publically shame you if you speak up.

Where does it end? With civil war. With death, destruction, violence, and the loss of everything that has been built over the last 200+ years. Then Islam, with all its evils, steps in and says "we have a better way." And clueless suckers like you will buy in and go to hell.

grinder said...

Do you believe in the rule of law? Think carefully, because rule of law is a foundational concept for this nation.<>

Yeah, in fact I do. The U.S. is signatory to a treaty that forbids torture for any reason, and obligates signatories to prosecute the crime. Therefore, I am sure you will agree with me that George W. Bush, Dick Cheney, Donald Rumsfeld, Condoleezza Rice, and a bunch of other officials of the prior administration should be prosecuted for torture.

As for bankruptcy, Chrysler filed form Chapter 11 last Thursday. If Perella Whineberg wants to hold out from the settlement, they should continue to do so. In return, other interested parties should offer their opinions about that.

So, wingnut, what were you saying about the "rule of law" again?

If law can be negated because you and Mr. Obama feel a lender is "greedy," then we have little left to continue to build this nation.<>

Exactly which law has been "negated," you stupid, lying, arrogant twit?

Your insurance policy? Worthless. Your 401K? Not worth the paper. The crops you just sold? Sorry, the money's not coming, you greedy farmer. The property you just bought for cash? Too bad, so sad, someone else took it and will publically shame you if you speak up.<>

Bankruptcy tends to have those impacts. It's not a political thing, it's a matter of the money running out.

Where does it end? With civil war. With death, destruction, violence, and the loss of everything that has been built over the last 200+ years. Then Islam, with all its evils, steps in and says "we have a better way." And clueless suckers like you will buy in and go to hell.<>

Bwaaaaaaaaaaahahahahaha!! Idiot Republican's favorite whining billionaire, Perella Whineberg, fails in an attempt to screw the taxpayers for another $250 million, and it's civil war and Islam. Unbelievable!

Matthew said...

Hey Grinder, I know it's difficult for you to stop your mastabatory rant, because it's probably the only time you feel anything approaching self-esteem, but...

For your information, Chrysler is NOT in a bankruptcy, 'prepackaged' or not; it is being forced by the Federal Government to negotiate a merger with a foreign company to avoid an actual bankruptcy. Stop watching MSNBC; you might learn something.(I defy you to provide a link to the actual bankruptcy filing. It should be public record. My bet is that you won't find one anywhere.)

And I don't wait tables, although I get the idea that you probably clean septic tanks. I have a Master's in Computer Science, and have spent the last 20+ years designing, building and programming automated trading systems. That's 20+ years on Wall Street, incidentally. Autoworkers are,indeed, paid better than technical workers (just ask the thousands of them here in NY who have to take contract work instead of full-time employment)...and the $70/hour figure includes their benefits.

And our job isn't mostly done by robot either. No one pays us to not work (furloughs), no one pays us when we're laid off (job banks),we don't have a collective bargaining agreement which is more like a license to steal. Our employer don't pay our medical benefits when they lay us off.

You can stop crying for the UAW because it's a waste of air.

bruce said...

Grinder, you are sad.

Perhaps you are biggotted against gay people, I am not. I suppose you tolerate the bigotry and self hatred of closet homosexual Republicans, I think we should move beyond it. And it was another poster that brought Jewish peoples into this. I do have a problem with Israel's human rights violations, however.

But I should say, it's sad to see that bigots such as yourself, who make cheap homophobic jokes, have infiltrated the progressive wing of politics!

At least we agree that it's shocking that anyone would be defending billionares. It's like the pathetic Russians who try to make excuses for that Yukos billionare. I will never feel sorry for a billionare.

grinder said...
This comment has been removed by the author.
grinder said...

bruce, take your meds

grinder said...

Matthew, Chrysler filed on Thursday. On Friday, the brave souls at Perella Whineberg backed down after realizing they'd be squashed in court, and in the court of public opinion.

As for your wage slavery, whine to someone who cares. I'm not carrying any torch for the UAW. It's a fact that they are taking a big haircut, as are dealers, suppliers, other creditors, the taxpayers, and now, Perella Whineberg.

No laws have been broken, so you can STFU any time you please.

bruce said...

Good point, Grinder. Unless this goes to court and someone is found guilty, there is nothing here of note.

grinder said...

p.s.: Matthew, maybe if you and your fellow nerds were man enough to form a union, you'd be treated better. Otherwise, all I can conclude is that you enjoy being treated like shit.

bruce said...

Also, Mathew, get your facts straight.

Chrysler did file for Bankrupcy. The point is that the Weinberg cowards settled BEFORE bankrupcy, so I guess we will never see whether they really did have some kind of supposed preferential treatment. That's convienent for you right wingers - it allows you to invent all this stuff about Weinberg supposedly being screwed over in some Cheney like conspiracy.

grinder said...

Matthew, here's the story you're looking for. Idiot.

grinder said...

And here is the White House denial of the Perella Whineberg lawyer's claim about being "threatened." Turns out that the lawyer is not only working for Perella Whineberg, but supported Hillary Clinton in the Democratic primaries. He's got a couple motives to lie, besides simply being a lawyer.

pal ashford said...

Bruce? You said "And it was another poster that brought Jewish peoples into this."

Ahhh, no. You initially said: "This Weinberg person (and I think we can all guess his religion ethnicity based on his name!) gets no sympathy from me."

I'm sorry. What was I thinking? You must have been intimating Weinberg was Italian then. How could I have thought that you were referring to him as a Jew, what with the name Weinberg and all and this being a discussion about Wall Street and the banking industry. And then your little remark about your opposition to Israel: "I do have a problem with Israel's human rights violations, however." Do you usually connect and associate blame to an entire people's religion or ethnicity to their ancestral homeland? I don't think so but it is interesting that people like you have no qualms about doing it to Jewish people.

Penina M. said...

Grinder,

I work in investment management. The core of our profession is that there is a set of rules that everyone knows and respects beforehand. That is why I used to have confidence in investing in US Securities, the Rule of Law protected me.

Obama is trying to abrogate those rules.

I balance risk and reward all the time. But there is no way to balance the risk that rules change tomorrow.

To take your baseball example. Imagine you are a pitcher, and you get 3 swings and misses on a batter. One would assume he is out.

But instead the umpire says...wait. This guy gets 5 strikes.

You might say, that is ridiculous, the rules state you get 3 strikes, and then you are out.

He says, "Hey buddy, unless you want all balls called from here on out, there will be 5 strikes from here on out".

grinder said...

Penina, I have forgotten more than you will know about investments. There is nothing illegal or unusual about the Perella Whineberg situation.

Whineberg was one of three (now two) holdouts among several-score creditors to an overall settlement brokered by the Treasury, which was acting in its role as the provider of DIP financing for the Chrysler bankruptcy.

Whineberg wanted 50 cents on the dollar, and the DIP financing provider wanted them to have 29 cents on the dollar. Whineberg knuckled under, but apparently trotted out its lawyer to spew some sourt grapes about having been coerced into the arrangement.

The White House has categorically denied the Whineberg lawyer's account, which quite frankly didn't ring literally true but which could be plausible if given a sort of free translation. In any case, this blog and some other wingnut blogs simply lapped up the Whineberg lawyer's claim without ever stopping to even consider his personal interest.

Had Whineberg continued to hold out, the firm likely wouldn't have prevailed in the bankruptcy court anyway. Bankruptcy judges have broad power to abrogate all contracts and many laws that impose financial obligations on bankrupt entities, including distinctions among classes of creditors.

To argue that "the rule of law" was ignored here is tendentious, partisan bullshit of the sort that the Republican wingnuts have been puking out for the last couple of decades. It's not true, and I suspect neither is your so-called "investment career."

grinder said...

By the way, the core principle of investment management is to try, and usually fail, to beat the benchmark. This crap about "the rules" tells me that you must be a very freshly minted MBA, at best, and not from a particularly esteemed school.

Corky Boyd said...

Comments are closed on this post.

I am new at blogging.

Yesterday's Island Turtle post was wideley circulated by other blogs and generated an enormous amount of traffic and comments. Unfortunately some were trolls who ended up using the comments section as a liberal chat room.

I wanted to close comments when things got out of hand, but I didn't know how without closing comments on all posts. I now know what to do.

This is a conservative blog, but I welcome constructive critical comments. What I don't want is the comments section to be taken over by trolls.

Unfortunately in this age there are organized liberal groups, some paid, which attempt to disrupt and overwhelm constructive comments. Their purpose is to give the impression the subject is held only by a small minority and they furher attempt to marginalize it.

For those who responded to the trolls, you answered factually and effectively. You didn't stoop to name calling. By acting responsibly you undercut their intended technique of creating chaos.

Thank you.