The US government is driving a hard bargain with GM bondholders, giving them little incentive to avoid bankruptcy court. Looks like the bondholders may call Obama’s bluff and see what they get from the judge unless his crew sweetens the pot a bit.
Every time a GM bankruptcy looks more likely, the dollar comes under pressure. We’ve ticked a biot higher, from the 1.3260s to the 1.3290s in the last little bit. Whether GM goes through bankruptcy in court or out, it will be a far smaller company 90 days from now than is is today and the government will have a lot more skin in the game…
