U.S. Is Said to Prepare Filing for Chrysler Bankruptcy

U.S. Is Said to Prepare Filing for Chrysler Bankruptcy

www.nytimes.com

The Treasury Department is preparing a Chapter 11 bankruptcy filing for Chrysler that could come as soon as next week, people with direct knowledge of the action said Thursday.

The Treasury has an agreement in principle with the United Automobile Workers union, whose members’ pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing, said these people, who asked for anonymity because they were not authorized to discuss the case.

Moreover, Fiat of Italy would complete its alliance with Chrysler while the company is under bankruptcy protection.

(visit the link for the full news article)

While bankruptcy is not a death sentence for a company... American and United Airlines came out of chapter 11 and continued on afterwards...

it is still not good. Especially for its creditors and especially for the smaller companies it owes money to.

Like it or not this is going to send ripples though out the entire economy.

www.nytimes.com
(visit the link for the full news article)

Oh wonderful.. The government takes on more liabilities because God forbid the democrats upset those union members that helped get them elected. Lets drop another few hundred billion into the pit. So much for a free market economy.

I am surprised that this thread hasn't gotten any traffic... this has huge implications.

What I don't understand is why is the government preparing Chrysler for Bankruptcy? Shouldn't Chrysler be doing that for themselves? Last I checked, the Government doesn't own Chrysler.

Funny thing is that soon after the OP's story came out, the government released this:

WASHINGTON (Reuters) – The Obama administration remains focused on bringing Chrysler and Fiat into a working partnership, a U.S. official said on Thursday, dismissing a news report that the U.S. car-maker faced imminent bankruptcy.

"In a negotiation like this, everything is speculation until there's a deal. It should surprise no one that the administration is planning on contingencies, but we remain focused on the goal and engaged with all stakeholders to bring Chrysler and Fiat to a working partnership," the administration official said.

news.yahoo.com...