An amateurish attempt at explaining current events large and small.
Monday, November 17, 2008
Chapter 11 for GM
The best argument I have heard for keeping GM out of chapter 11 is that they won't be able to obtain DIP (Debtor-in-possession) financing and thus will actually end up in Chapter 7. However, if this is the reason why they need a bailout as opposed to bankruptcy couldn't the government provide the DIP financing? Then you can sustain GM through the reorganization, and more importantly, a reorginazation in fact occurs.