A person at a hedge-fund firm that owns Chrysler loans, speaking anonymously, told Dow Jones Newswires that the difference between what loanholders would get in bankruptcy and out of bankruptcy wasn’t that much, meaning the non-TARP lenders are making a political statement more than anything.
“Are they taking reputational risk for pennies?” asked the person. “Do the math on the recovery levels. It doesn’t make sense for them to have held out for purely economic value.”
Good for them.