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  • The Chrysler Stay: Reading the Tea Leaves

    The talk shows last night were all atwitter over Justice Ruth Bader Ginsburg’s grant of a temporary stay for the Supreme Court to consider the application for an emergency stay of the sale of Chrysler to a government-backed shell corporation.

    What do we know this morning? A few thoughts:

    • The only thing we know for sure is…the Court needs more time. A temporary stay does not provide any direct indication as to how the Court will rule on the application.
    • That said, this is an unusual move. Temporary stays are relatively rare outside of the death penalty context. Ginsburg, and likely the Court as a whole, are giving this issue extra attention, perhaps due to its importance in terms of law as well as economic consequences–in other words, the government’s fear-mongering may have done it a disservice.

    • Many expected an order last night–on the assumption that the Court needed just a few hours more to draft an opinion or dissents. That didn’t happen, which is telling.
    • Specifically, we can predict that the Court is unlikely to reject the challenge out of hand–that could have been accomplished in short order, as with most such applications. This may indicate that one or more justices are inclined to grant the stay, or at least leaning in that direction.
    • It may be that the Court is waiting for reply briefs from the challengers. That just means, though, that not all the justices’ minds are made up.
    • An order could issue at any time, but it is likely to come soon. That’s the nature of temporary stays, and there is a distinct urgency in this case.

    The odds are still heavily stacked against those challenging the sale–that’s the nature of last-minute challenges. But the events so far do give some small reason for hope; this is exactly what the Court would do as a first step if it were seriously considering taking the case.

    Posted in Economics [slideshow_deploy]

    12 Responses to The Chrysler Stay: Reading the Tea Leaves

    1. MAS1916 - Denver, CO says:

      Obama wants this deal done in a big hurry. Like closing Guantanamo, getting the Chrysler deal done is more important that having a plan for a successful and positive outcome.

      The Chrysler fire sale is being pushed by Team Obama to showcase the President's ability to run the economy ( for the top ten strange reasons why Obama wants the Chrysler deal done soon, you can look at: http://firstconservative.com/blog/political-humor… )

      The Supreme Court's role in this is interesting though… The bankruptcy process has been used successfully by airlines and other major organizations to recover from difficult times. Obama's intervention seeks to change that process and the court wants (or should want) to make ensure that shareholder rights are protected.

    2. Pingback: frankhagan.com » That Pesky Rule of Law

    3. Duke, Ohio says:

      The stay is gone. Did Obama intimidate the SCOTUS? It worked for FDR!

    4. Steve, Michigan says:

      I don't think people recognize how dangerous all of this is… We've got a President who is ignoring the laws of this country. By law, bond holders are the first to be re-payed. If the President doesn't like current law, there is a process to change it legally. If we, and other countries, can't count on the rule of law in this country, who's going to invest in it? This puts us down with dictatorships who make things up as they go… This is not a good precedent to set for future bailouts!

    5. Normca says:

      Another dissapointing outcome from the court of last resort. By denying the review, the full court approved the change in bankruptcy law via presidential action and the destruction of the rights of bond holders for the future. This is another step along the path of the retribution president in bringing America down to size. Wait till October when the nominee is the 9th member of this court, bringing her bias with her.

    6. Dirty Harry , AZ says:

      The pot is boiling and the frogs are already in the pot. A scary situation for the USA

    7. Lynn B. DeSpain says:

      Nothing like having an Estate Sale before the people have passed on! Upsets those that haven't died yet, but just an inconveinience for those selling off their entire life's accumulaions of treasures. Seems as though the Courts agree. Of course it is easier fo me and my own. We've always been Ford People. How I pity the GM and Chryler families, having to wait in line for warrentee work with all those Illegals applying for licenses! What a shame. What a line! WHAT A LOT OF PAPER WORK!

      Hozro

    8. Jerry from Chicago says:

      Team Obama is running the country alright, right into the sewer. Everything this man and his administration have done so far have,and will have, deleterious effects on the country.

      My initial thought was that his actions would have the exact opposite effects from his intentions, but now I'm thinking that perhaps these deleterious effects were his intentions. Maybe this is what people have in mind when they call him brilliant.

      After having quadrupled the deficit of the former administration within the first 6 months of his term and passing a budget greater than the combined budgets of all previous administrations, he now has the nerve to lecture the public about "pay as you go". It's obvious that Team Obama has been looking at the polls. The American public is starting to get angry about how much debt this President has created and are getting fearful of how this debt will be paid. So now, of course, he and Ms. Pelosi pretend cast themselves in the role of fiscal conservatives. This is akin to Hugh Hefner and Heidi Fliess preaching celibacy. This pay-as-you-go philosophy would have been much better received had he championed this cause 6 months ago, before "Stimulous". Now, this is nothing more than the harbinger of their intended program of tax increases.

      Despite the promises of all those 'shovel ready' jobs he was going to create, the unemployment rolls continue to swell and that doesn't take into consideration the bankruptcies of GM and Chrysler and the job losses that will be forthcoming at those factories, dealerships, parts suppliers, etc.

    9. Al, The Villages, Fl says:

      SCOTUS punted, why? We, apparently, are no longer a country of the rule of law. I must admit that, taking the stim funds, you are stuck with the strings attached but where was the board? Why didn't the CEO, COO, CFO whatever stand up and fight against a government takeover? PRAVDA was right – they gave up without a whimper. We must not be educating very bright business people these days – certainly not traditional americans.

    10. John B. Williams Eva says:

      Richard Mourdock, the Indiana State Treasure who challenged the Federal Government over the Chrysler deal is a true patriot. I am proud of him for taking a stand against goliath. It seems only he and talk show hosts have had the stones to face the democrat's coup d' etat using the law as their basis. Guess we know now where the Supreme Court stands on the issue of law.

    11. Pingback: The Chrysler Stay: Reading the Tea Leaves « Conservative Thoughts and Profundity

    12. Mindy says:

      I never ever post but this time I will,Thanks alot for the great blog.

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