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Yet GM still went bankrupt...just a few months later. People forget that. So what was really gained?
by ericcumbee 13y ago
Yet GM still went bankrupt...just a few months later. People forget that. So what was really gained?
- rayiner 13y agoThere's bankruptcy as in a controlled restructuring, and then there is bankruptcy as in a failure of the business with ripple effects throughout the economy. What GM went through was the former, and it was foreseen at the time of the government's investment.
- ericcumbee 13y agoThere was nothing to keep them from going through a controlled bankruptcy at the start of it.
- danielweber 13y agoPeople forget just how amazingly tight the credit markets were at that time. Extremely tight. To keep it short, the bailouts of both the auto sector and the banks were bad, but probably the least bad of a bunch of very worse options. The moral hazard problems with both of them are significant. (It's personally good to fail at the same time as everyone else, because you get bailed out, while we really want systems where failures are independent.)