GM

By John Terrett in Americas on November 6th, 2009

I might be wrong but I thought I detected a little flirting going on between U.S. Secretary of State Hillary Clinton and her guest at the State Department on Thursday, the new German Foreign Minister Guido Westerwelle.

Perhaps flirting is a bit strong but there was definitely a "chemistry" between them shall we say, as they addressed journalists in a packed suite on the upper floors of the U.S. State Department in the Washington district of Foggy Bottom.

In some ways I felt a bit sorry for the German delegation.

They were so obviously thrilled to be in DC but all the hacks wanted to ask about was what he thought about GM retaining Opel and what she thought about Mahmoud Abbas declining to stand for election as Palestinian President in January.

On the first point, Westerwelle repeated his stance that German tax payers must be paid back the money they've given to GM to bailout its Opel division.

By John Terrett in Business on May 27th, 2009

So why did GM’s bond holders effectively end the iconic company’s chances of reorganising itself outside a bankruptcy court?

It’s now expected GM, which helped make the 1900s the American Century, will file for Chapter 11 later this week or early next.

Such a move will mark the end of the hey day of motor vehicle manufacturing in the United States.

The bond holders, however, are taking a risk.

They’re gambling that a bankruptcy judge will give them a better deal than the one GM was offering - a ten percent equity stake in any new firm in exchange for dropping claims on the $27-billion they’ve invested in unsecured loans or bonds.

The bond holders - who range from pension funds through mutual funds to banks and hedge funds - may or may not be right but their decision means that in a few days - without a massive change of heart  - GM will be run by a court.

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