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What risks did they agree to take on?
Do you have a list?
Link?
The government deliberately cir venting bankruptcy laws to benefit a favored political contributor wasn't part of the risk the bondholders agreed to take on.
What risks did they agree to take on?
Do you have a list?
Link?
The problem there, Chump, is that Corporate Bonds are typically not high risk investments. Many of the long GM bonds that were defaulted on were initially highly rated...it wasn't until 2005 that they were downgraded. even then, historical precedent was that they would be top tier secured creditors in a bankruptcy...after the assets were sold the bondholders would be the first to be paid.
Instead, the bondholders were told "sorry, you are out of luck' and they just wiped out the debt and gave the company to the UAW.
VERY bad form. I find it hard to believe that you are actually defending this.
So they knew they were increasingly risky investments for four years?
VERY bad decision making.
If you really need a link and a list explaining how bonds work then this topic is over your head.
someone saved the company and jobs.
why u hate amerika?
You claim to know all of the risks bondholders take.
Let's see them.
You're right...when it was confirmed that GM would seek a bailout, the share price jumped and I sold. I went back and looked at the screen shot of the sale. I actually sold at $4.98. Doh! I sold on 11/26/2008. The Fed loans were granted 12/19/08.
I could've ridden it longer and made a bit more, but it was a very good return at sale, so I can't complain.
TeyshaBlue was a smart investor in this case.
The people who held on or bought in? Not so much -- but they assumed the risk.
You are confusing the relative risk of stocks and bonds. It is virtually unheard of for bondholders to be wiped out.
If a "regular" company tried that in bankruptcy they would get laughed out of the bankruptcy court and the attorney that proposed it would probably be disbarred for ignorance.
You claim to not know them. If you're seriously interested in the topic then go learn. Google is your friend.
bonds are risky. period.
So it's not actually unheard of.
Thanks again.
I'll take that as an admission that you don't know either. Otherwise it would have been easy for you to say.
Thank you, too.
They are virtually unrisky!
"virtually"
"unheard"
"of"
And I'll take that as an admission that you weren't really interested in learning about bonds. Otherwise it would have been easy for you to look up the information. Glad we've got that settled.
On further research I can find NO cases where the bondholders were wiped out in bankruptcy. I had vaguely remembered some bondholders might have gotten hurt in the huge asbestos litigation settlement but they were made completely whole too as part of the agreement.
If you can find a SINGLE CASE where the bondholders were wiped out in a bankruptcy hearing feel free to refute me.
would you have preferred the company be wiped out, solely for shareholder benefits?
It's the bondholders fault for the govt stealing their assets. Okay
Shareholders or bondholders? The shareholders got exactly what they deserved, which is jack squat.
Nah, I was asking you directly to see if you really knew.
You didn't know at all.
Glad we've got that settled.
This wasn't a bankruptcy. It should have been. But it wasn't. Bondholders knew that was a risk.
Are you so ing stupid you don't know the difference between stocks and bonds?
bondholders are subject to market risks, too.
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