Monday, June 15, 2009

GM Bondholders: American Savers and Investors, Not “Speculators”

When people think of "bondholders," they imagine tycoons. J.P. Morgan. Warren Buffett. Even the fictional Gordon Gekko of "Wall Street" fame...In fact, tens of thousands of the bondholders of General Motors Corp. are not rich at all — and never were, even before the value of their bonds collapsed in the months leading up to the giant automaker's bankruptcy filing..Most of the company's $27 billion in private debt is held by investment firms. But many of those firms are actually managing the money of individual investors. And fully 20 percent of the bonds are owned personally by roughly 100,000 mom-and-pop investors across the country, according to Main Street Bondholders, a group organized to lobby on their behalf....GM's Deal Erased Many Average Americans' Savings, William Ehart, Washington Times, 6/15/2009
The reason so many dictatorships fail is because the center of power ignores the overall consequences of what are usually described as actions on behalf of the good. Without the bother of consulting with all the involved parties, a lot of time is saved, of course. The appearance of boldness and decisiveness is impressive. Ask any Venezuelan. But, ignoring consequences, as if the impact of an act on this group of ten, or that group of ten thousand, were just personal matters for the affected, has a price. In not very many years, most of the eyes gazing upon the great one at the podium are not looking out for the next great thing, but for the great man's fall.

Go to the link and then follow the one to portraits of investors in GM.


1 comment:

Wonker said...

Intriguing how little the press has followed up on this absolutely unconstitutional transaction. Bondholders are, lest we forget, "senior creditors," not unions. They, not the unions, stand first in line when an outfit goes outta business.

The Obamanation has violated this critical lynchpin of American capitalism and constitutional law without being called on it, save by a few lawyers for pension systems attempting to perform their fiduciary duties by defending their retiree bondholders--many of whom, BTW, are actually public employee union members (re: Indiana).

But a foolish consistency is the hobgoblin of little minds, eh? The left is now savagely exploiting an uneducated electorate by screwing the constitution and eviscerating property rights. Great if you're a socialist. Which they are.

But the socalled free press continues to cover for them.