General Motors and Chrysler may be forced into Chapter 11


It seems that the Obama Administration is playing hardball with GM and Chrysler. They may force the companies into bankruptcy to protect American taxpayers from having to pony up yet more money for the beleaguered automakers.

I see this as a positive development — although a pre-packaged Chapter 11 solution is the way this should end (a messy bankruptcy could trigger some Lehman-like fallout. The automakers should be handled with care.).

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Meanwhile, in Europe, France is bailing out their automakers. “This is not a gift. It is not a subsidy. It is a loan offered at an interest rate of 6%,” French President Nicolas Sarkozy said. Right.

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French carmakers get 6.5bn euros – BBC News

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