Wouldn’t it be great if you could sell yourself all of your good assets while leaving behind all of your debts. That’s what GM has done today as they emerged from one of the shortest corporate bankruptcies in history.
GM shed a lot of it’s debt today after it sold itself to itself. Included in the sale were only the valuable assets. The old GM was left with massive debt obligations that will get paid off for pennies on the dollar.
If you’re with billions, this is what you get to do. If you’re like us — average people — then you get to do it the old fashioned way. If you declare bankruptcy, some of your debts will get discharged, but many will still need to be paid. The biggest difference between you and GM is that your credit will suck, while GM gets billions in loans from the government.
Does this sound fair? It really isn’t, if you consider that GM should have just been allowed to fail in the first place. I’d put even money on GM failing in the next couple of years anyways. The inevitable has just been prolonged.
