President Obama says Chrysler investors greedy and Will be Dealt With!

Well President Obama came out this week and announced that Chrysler would go into bankruptcy. This is a move most everyone knew was coming months ago, except for the US government of course.

Remember a few months ago when the heads of the three auto manufacturers went to Washington? Pelosi, Reid, and even President Obama said they were to big to fail and proceeded giving them taxpayer money. So, on behalf of the American taxpayers, our government gave these companies billions of dollars to get their act together. Your money!

Shouldn't the government in all it's wisdom give them "your money" only after studying AND UNDERSTANDING their plan for restructuring? I would assume if you are going to give someone several Billion dollars you are confident they will pay it back. Now I'm not going to throw blame on the Big 3 manufacturers for their situation; that's another discussion entirely.

So this brings me to the news conference the President held announcing the bankruptcy of Chrysler. First when the hell does a President go live on TV to announce the bankruptcy of a US company? That's a bit weird don't ya think?

In his speech President Obama reads [from the teleprompter], "My job as president is to ensure that, if tax dollars are being put on the line, they are being invested in a real fix that will make Chrysler more competitive".

He proceeded to talk about a small group of investors or hedge funds who were, "demand[ing] twice the return that other lenders were getting."

Obama states, "Now, while many stakeholders made sacrifices and worked constructively, I have to tell you, some did not. In particular, a group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout."

He continues, "Because of the fact that the UAW and many of the banks, the biggest stakeholders in this whole process have already aligned, have already agreed, this process will be quick, it will be efficient. It's designed to deal with those last few holdouts, and it will be controlled."

OK So now President Obama has identified their were "holdouts" that were hampering the Chrysler bankruptcy deal and they would "be controlled" or dealt with. He said they were demanding twice what others were getting. Greedy huh?

First these 'holdouts' were secured investors. This means they invested in Chrysler and are the first in line to get 100% of their investment back before anyone else. This is basic investing and done all the time.

Second these 'holdouts' agreed to take 50% instead of 100%. Yes they agreed to this but the government or President Obama's task force said no you will take 29%.

These 'holdouts' would not accept 29%. and felt they had an obligation to their investors. Therefore in his speech the President pointed this group out as a small group of 'holdouts' wanting twice the return other lenders were getting even though they are entitled by law to get 100%!

Also, most if not all of these 'holdouts' did not get TARP money. Many of other lenders who are taking the 29% did get TARP money.

It was also pointed out that the President is also trying to influence a judge before a court case or bankruptcy. READ THAT LINE AGAIN. The President is trying to influence a judge. Is this how they will 'deal' with the 'holdouts'?

One last point. The attorney for the group of holdouts says that one of his clients was directly threatened by the White House if they did not remove their opposition to the deal. They were told the "full force of the White House press corp would destroy it's reputation". See audio link below.
UPDATE 5/4/2009 - Some of the funds say they were not threatened by White House. Only the attorney made that statement.

To sum it up:

You have a group of so-called 'holdouts' who are looking out for their investors. They have done nothing wrong, did not get TARP money, and are acting within their rights given to them by The Constitution. They also are trying to help Chrysler by taking only 50% of their investment. In return The President essentially portrays them as greedy hedge fund investors that will be dealt with. Don't forget a few months ago the government gave Chrysler billions of dollars of your money. What is that money worth now?

The words from his speech that really stand out are "designed to deal with" and "controlled". Should any President control or deal with a group who does not conform to that government wishes? Think about it.

Oh yes did I mention when it's said and done that the UAW will own 55% of Chrysler?

Notes
The Mark Levin Show last week brought much of this to light.
marklevinshow.com

Sources:
Audio Link to Holdout Attorney discussing threat
Full Transcript of Obama's Speech

See Judge Napolitano Discuss President irresponsible remarks

Views: 25

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Comment by Steven on May 13, 2009 at 7:35am
The Democratically controlled Congress easily approved a $3.4 trillion spending plan, setting the stage for President Obama to pursue the first major overhaul of the nation's health-care system in a generation along with other far-reaching domestic initiatives. I don't know how to stop this with only one vote, but I will continue to be optimistic in my business and think positive in politics.
Comment by William D. Huffaker on May 6, 2009 at 12:33pm
comment on the update: I can't help but think that the holdout investors who now say they were not threatened by the White House have just given in to the threat of ruin of their reputations. After all we have already seen a lot of that with this administration. And those threats were made public with BHO's comments about the holdouts, as if they were the greedy wrong ones here. They are being done wrong, by Chrysler and the White House
Comment by Fin Barr on May 4, 2009 at 11:56pm
Hey...Obama how's 'bout we only pay 29% of those taxes we owe! You settle for bub?
Comment by Betsy Ross on May 4, 2009 at 10:55am
I have never seen so many ignorant mindless brainless un-american people that blindly "follow the leader", without having on simple brain cell of a thought of their own!

And worse yet, people that know this is wrong, yet refuse to get involved. They just sit there and watch our liberties, money and security blow out the window, and never lift a finger to try to stop it.
Comment by Maura Jarve on May 4, 2009 at 9:38am
i have never seen such blatant corruption and destruction happen so quickly in my life, and I never did think it would be our country where it happened.
Comment by Earl B on May 4, 2009 at 8:25am
UPDATE: On Fox News the 'holdout' investors say they were not threatened by White House, only the attorney made those comments. I'm sure this will develop over the week.
Comment by rhona davis on May 3, 2009 at 10:53pm
you said it well Bert Cole...my sentiments exactly. I have listened to these left-winged liberals for so long that when non of us are earning a living....where will the money come from...? our values mean nothing and we are being stripped of our rights and too many cannot/will not think about this. they don't have the capacity to critically evaluate what is going on and therefore "the annointed one" will have his way....at least for a while.
Comment by Bert Cole on May 3, 2009 at 10:24pm
Note to david:

You sir, are an idiot. Does a binding contract now mean nothing if the president says it shouldn't? If that's the case, I can't wait until he gets around to YOUR industry/workplace. Answer me his, if you would? Why are UAW contracts so sacred and unbreakable, to the point that the UAW is being given ownership in the corporation, but contracts with guaranteed returns aren't treated the same?

Let me make it simple for you dipstick. The "hedge funds" that your "anointed one" refers to are made up of investment groups. Most of those investment groups get their money from individuals, common people working hard to make a few bucks, and investing some of it in the hope of retiring one day without having to depend on future taxpayers for their support.

I know that goes against everything you believe in, but deal with it. Some of us would prefer to make it on our own instead of living off the government tit when we retire. Those of us that work hard for a living are tired of supporting the lazy, selfish slugs of society that that feel they're somehow entitled to the fruits of our labor.
Comment by Betsy Ross on May 3, 2009 at 2:05pm
"The President should not take sides in such a matter."

Famous Last Words! Yes, this judge will end up like the AIG execs and Joe the Plumber. Let's face it, the President and his Admin has done many things the should not do. Laws, public opinion, the constitution, NOTHING matters. They do what they want and they continue to get away with it.

Another thing that jumps out at me is that "the government has the money" to invest in Chrysler...No it doesn't! Remind me again how much our national debt is. So what will they do tax us more or have the Fed print up more money?
Comment by Earl B on May 3, 2009 at 10:47am
Yes the court will 'control' or handle the bankruptcy and the President should have no say or influence. The President should not take sides in such a matter.

 

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