View Poll Results: Which is the Riskiest Investment?
Ford Bonds
0
0%
GM Bonds
8
53.33%
Barry Bonds
7
46.67%
Voters: 15. You may not vote on this poll
Which is the Riskiest Investment?
Go Army!
Joined: Aug 2005
Posts: 178
From: Ellicott City, MD
Re: Which is the Riskiest Investment?
Typically bond-holders are the first ones that have to be repaid in bankruptcy court. Before suppliers, stock holders, and even employees in some cases.
) ... Yep, bondholders are in the group of "unsecured creditors" who get paid after "secured creditors" and most definitely *before* stockholders. However, if the company is liquidated, there is certainly a chance that paying the secured creditors will exhaust the proceeds of liquidation -- which means that there is a chance that bondholders get nothing.
A lot more can be found at http://www.sec.gov/investor/pubs/bankrupt.htm
Active Enthusiast
Joined: Feb 2006
Posts: 147
From: Central PA
Re: Which is the Riskiest Investment?
AZCivic,
Yes, that is true, IF the physical assets of the company exceed the value of the debt. I believe I read somewhere that GM has over 300 BILLION in debt out there. I doubt a bunch of 20 year old automobile factories are going to sell for over 300 billion. I suspect as David Harville notes, that the subordinated debt holders of GM bonds will have a rather rude awakening if GM does declare bankruptcy.
Eric
Yes, that is true, IF the physical assets of the company exceed the value of the debt. I believe I read somewhere that GM has over 300 BILLION in debt out there. I doubt a bunch of 20 year old automobile factories are going to sell for over 300 billion. I suspect as David Harville notes, that the subordinated debt holders of GM bonds will have a rather rude awakening if GM does declare bankruptcy.
Eric
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Banned
Joined: Apr 2005
Posts: 3,155
From: Lewisville (Dallas), Texas
Re: Which is the Riskiest Investment?
Originally Posted by williaea
AZCivic,
Yes, that is true, IF the physical assets of the company exceed the value of the debt. I believe I read somewhere that GM has over 300 BILLION in debt out there. I doubt a bunch of 20 year old automobile factories are going to sell for over 300 billion. I suspect as David Harville notes, that the subordinated debt holders of GM bonds will have a rather rude awakening if GM does declare bankruptcy.
Eric
Yes, that is true, IF the physical assets of the company exceed the value of the debt. I believe I read somewhere that GM has over 300 BILLION in debt out there. I doubt a bunch of 20 year old automobile factories are going to sell for over 300 billion. I suspect as David Harville notes, that the subordinated debt holders of GM bonds will have a rather rude awakening if GM does declare bankruptcy.
Eric
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