sorry for the bad pun.
continuing to prove that government intervention will only make problems worse, here's an article that explains how the 100% payment of AIG counterparties will lead directly to GM going bankrupt.
basically, since a lot of the bond holders of GM (who have control over whether to ok a haircut or force GM into bankruptcy) also own a lot of CDS on GM (issued by AIG), it's in the bond holders' best interest for GM to go chapter 11. now, i know a get a lot of complaints (well, just one from Ivan but that's 12.5% of my regular readers) when i blame the leftist, interventionists like Geithner and Obama for making matters worse than they already were, but here seems to be a clear case example showing how the rescue of AIG resulted in the failure of GM. of course, GM would have failed earlier without government intervention. but now, the taxpayers are out of trillions AND GM is still going bankrupt AND AIG counterparties (like foreign banks) are made whole. certainly, this will result in fewer (if any) benefits to GM pensioners and a massive loss of jobs - which means a further burden on taxpaying americans. for those that disagree, please explain how the "best and brightest" that obama has supposedly brought in are actually making things better.
I sound like a broken record, but I don't think you can judge the effectiveness of their policies after 3 months of work. I tend to agree with your position about GM. Despite the job loss, which is unfortunate, the American car companies haven't been competitive for years and should've been allowed to succumb to market forces. That being said, I think that there was not choice but to bail out AIG, whether it was done correctly remains to be seen.
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