Advisors to GM Bondholders: It's All Political

Advisors to bondholders representing nearly half of GM's corporate debt said in an emailed statement that the current offer is "neither reasonable nor adequate" and complained that it was made unilaterally.

"We believe the offer to be a blatant disregard of fairness for the bondholders who have funded this company and amounts to using taxpayer money to show political favoritism of one creditor over another," the group said. "Today's posturing makes it clear that the company and the auto task force would rather discount the thousands of individual investors and retirees who own GM bonds than undergo earnest negotiations.

Will the Obama Team play the Paulson card now and try, through brute political power, to attempt to force the current structure of the deal on bondholders? Stay tuned. This is not your grandfather's capitalism, and it is getting less so everyday.