Call them the unlikely speculators.
Mechanics, educators, engineers of modest means. These are among the roughly 100,000 people who own General Motors Corp. bonds. Some bought the bonds before they were downgraded to junk status yet decided to hang on to them. Others went in with eyes open, buying at a substantial discount to the bonds' face value, betting the company wouldn't crater and their gamble would eventually pay off.
Speculation was what they did, whether they like the term or not.
http://www.washingtontimes.com/news/2009/jun/17/gm-investors-pay-hefty-price-for-speculation/
This is the continuation of a Series of articles in the Washington Times concerning GM Bondholders. Although I think the articles are for the most part well done, I took exception to the term "Speculator" used in the title. But then, I gave it some thought and "Speculator" wasn't a nasty or derogatory term until Mr. Obama made it one when he referred to Chrysler bondholders as "Speculators". Anything in the future, whether its getting out of bed in the morning, eating a piece of fruit or making an investment involves some degree of "speculation" as to the outcome in the future. We base our judgement on our past experience, laws in place or other known factors in making our decisions. When someone comes in and changes the rules or circumvents the law, I think a better term is "victim" rather than "speculator".
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Speculation is an incendiary a word when allied to Bondholders as Mr. Obama so pointedly pointed out about the Institutional Bondholder with Chrysler were “Speculators”! Any investor in stocks or bonds involved some degree of speculation as to the outcome. When the Government changes the rules and gives preferential treatment to some groups (UAW) over others (individual bondholders) are going to lose. Fortunately we have a court system so the final chapter is just being written.
ReplyDeleteLet’s not place the “blame” for the losses on the bondholders. It’s like “blaming” rape victims for walking alone too late at night, wearing the wrong clothes, or somehow encouraging the attacker to assault them. Place the “blame” where it is due on GM and The Task Force.
The only “Speculator” in this game is the Team GM/Government that “speculates” those they have stolen from will lie down and do nothing. Boy are they wrong and stand to loss a bundle.