City of Detroit Files for Bankruptcy Protection

**compn** · July-18-13, 02:43 PM

kevin orr is a bankruptcy guy
kevin orr's firm is a bankruptcy firm

we knew this on day one. i'm surprised they didnt say the b-word until now.

**corktownyuppie** · July-18-13, 02:49 PM

Originally Posted by compn

kevin orr is a bankruptcy guy
kevin orr's firm is a bankruptcy firm

we knew this on day one. i'm surprised they didnt say the b-word until now.

I'm confused on this, too. Orr threatened bankruptcy in his first public address and first media interviews. He mentioned it several times through the process, even stating that the week of July 15 was going to be the week when the decision was finally made.

The idea was to see if they could settle up [[or partially settle up) as much of a deal as possible to minimize the time and expense in bankruptcy court which would be inevitable if too many creditors rejected the deal.

What I think is fascinating is the number of creditors who haven't outright rejected the offer. They are doing and saying a lot of things: filing lawsuits, writing articles stating that the offers are "unfair", hosting press conferences. But the one thing all the creditors are afraid to do is say, "no deal".

It does have me wonder what is actually going on behind the scenes there.

**TexasT** · July-18-13, 02:50 PM

Originally Posted by corktownyuppie

I'm confused on this, too. Orr threatened bankruptcy in his first public address and first media interviews. He mentioned it several times through the process, even stating that the week of July 15 was going to be the week when the decision was finally made.

The idea was to see if they could settle up [[or partially settle up) as much of a deal as possible to minimize the time and expense in bankruptcy court which would be inevitable if too many creditors rejected the deal.

What I think is fascinating is the number of creditors who haven't outright rejected the offer. They are doing and saying a lot of things: filing lawsuits, writing articles stating that the offers are "unfair", hosting press conferences. But the one thing all the creditors are afraid to do is say, "no deal".

It does have me wonder what is actually going on behind the scenes there.

Leaking this info to the press may force their hands.

**ct_alum** · July-18-13, 03:01 PM

Originally Posted by compn

kevin orr is a bankruptcy guy
kevin orr's firm is a bankruptcy firm

we knew this on day one. i'm surprised they didnt say the b-word until now.

Correct, bankruptcy was the plan all along, along with breaking the unions and privitizing as much as possible. BTW, noticed that Bank of
America has already accepted 75 cents on the dollar, not much of a haircut - What a surprise!

**mwilbert** · July-18-13, 04:11 PM

Originally Posted by ct_alum

BTW, noticed that Bank of
America has already accepted 75 cents on the dollar, not much of a haircut - What a surprise!

That wasn't unsecured debt, so actually it was a pretty large haircut. It was somewhat surprising they accepted the 75 cents.

**Locke09** · July-18-13, 04:16 PM

Originally Posted by mwilbert

That wasn't unsecured debt, so actually it was a pretty large haircut. It was somewhat surprising they accepted the 75 cents.

With the high rate they have been charging the City, I wouldn't doubt that they have actually already recovered the principle.

**mwilbert** · July-18-13, 04:22 PM

Originally Posted by Locke09

With the high rate they have been charging the City, I wouldn't doubt that they have actually already recovered the principle.

You could well be right. That whole deal started as tribute to the incompetence of the city's financial people, and ended as a cautionary tale of what happens when you have to make a deal and have no cards.

**Locke09** · July-18-13, 04:20 PM

The governor flat out lied and said Kevyn Orr hadn't recommended bankruptcy to him. But his letter says Orr recommended it on July 16th.

Anyway, the battle now moves in part to whether a plan that proposes to cut pensions will be considered a legal plan. The bankruptcy code says the plan cannot violate law. It does not say what law. Federal pension rules [[ERISA) do not apply to public pensions, so it is not clear that there is any applicable federal law to trump the state law. At least none I have uncovered yet.

**Wesley Mouch** · July-24-13, 01:50 PM

Originally Posted by Locke09

The governor flat out lied and said Kevyn Orr hadn't recommended bankruptcy to him. But his letter says Orr recommended it on July 16th. ...

Its all in perspective, isn't it? Bill Clinton didn't have sex with that woman. Did Orr 'recommend' bankruptcy, so say 'hey, I think we're gonna have to go that way'? What's the difference? Is catching Snyder in a 'lie' important? So yes, let's move onto what happens next. Suits are filed. Judges are going to settle them. Let's leave arguments about how many angels can dance on the pension check or whether an official recommendation was made to the past. Let's discuss the issues -- not the political spin.

**Locke09** · July-24-13, 02:02 PM

Originally Posted by Wesley Mouch

Its all in perspective, isn't it? Bill Clinton didn't have sex with that woman. Did Orr 'recommend' bankruptcy, so say 'hey, I think we're gonna have to go that way'? What's the difference? Is catching Snyder in a 'lie' important? So yes, let's move onto what happens next. Suits are filed. Judges are going to settle them. Let's leave arguments about how many angels can dance on the pension check or whether an official recommendation was made to the past. Let's discuss the issues -- not the political spin.

The trustworthiness of the parties involved is always going to be an issue for me. I am never going to be willing to overlook subterfuge and outright lies. Snyder has a letter from Orr recommending bankruptcy, not some verbal discussion that could have been misinterpreted. As others have pointed out, it isn't Snyder's first time playing with the truth.

I would think a judge will also want to have confidence that what people on both sides present in court is truthfulness to the best of their knowledge.

I would think that detroit citizens also want to have confidence that when Snyder/Orr tell them they will benefit from this [[not just a few anointed neighborhoods) then they will keep their word.

Actually, if you think about it, a bankruptcy occurs because people cannot or will not keep their word - doesn't it? Trustworthiness helps you believe a person when they say it's "I cannot" vs. "I choose not to."

**mwilbert** · July-24-13, 02:24 PM

Originally Posted by Locke09

The trustworthiness of the parties involved is always going to be an issue for me. I am never going to be willing to overlook subterfuge and outright lies. Snyder has a letter from Orr recommending bankruptcy, not some verbal discussion that could have been misinterpreted. As others have pointed out, it isn't Snyder's first time playing with the truth.

I would think a judge will also want to have confidence that what people on both sides present in court is truthfulness to the best of their knowledge.

I would think that detroit citizens also want to have confidence that when Snyder/Orr tell them they will benefit from this [[not just a few anointed neighborhoods) then they will keep their word.

Actually, if you think about it, a bankruptcy occurs because people cannot or will not keep their word - doesn't it? Trustworthiness helps you believe a person when they say it's "I cannot" vs. "I choose not to."

I think you are correct that trustworthiness/credibility is important. However, it was always apparent that bankruptcy was the likely destination of this process, and presumably the bankruptcy judge will review the actual facts of the situation, including whatever facts the pension beneficiaries and the bond insurers want to present, so while I understand your distaste for whatever level of deception you think occurred, I don't see that it has any substantive effect.

**Wesley Mouch** · July-24-13, 03:29 PM

Originally Posted by Locke09

The trustworthiness of the parties involved is always going to be an issue for me. I am never going to be willing to overlook subterfuge and outright lies. Snyder has a letter from Orr recommending bankruptcy, not some verbal discussion that could have been misinterpreted. As others have pointed out, it isn't Snyder's first time playing with the truth.

I would think a judge will also want to have confidence that what people on both sides present in court is truthfulness to the best of their knowledge.

I would think that detroit citizens also want to have confidence that when Snyder/Orr tell them they will benefit from this [[not just a few anointed neighborhoods) then they will keep their word.

Actually, if you think about it, a bankruptcy occurs because people cannot or will not keep their word - doesn't it? Trustworthiness helps you believe a person when they say it's "I cannot" vs. "I choose not to."

Yes, absolutely. Trustworthiness is crucial. Its a valid issue.

Politics have intensified. Each and every word is recorded. Look at Romney and 47%. You say something stupid once, and you're toast. Our parties have entire departments dedicated to finding 'lies'. They put together things. Remix videos. They tell their story. The story they want you to hear.

I don't think Bing, Snyder, Obama, Pelosi, Frank, Orr, Clinton, or Bush really lied -- well let me take that back. They all lied. If you want to find lies. Parse their words, and you will find lies. Everyone lies if you seek lies.

Instead try finding truth. Listen to those who speak the truth.