The Hoax Of The Chrysler Sale

Cerberus Capital Management LP in August closed its $7.4 billion deal to buy a majority stake in Chrysler from the automaker's former parent, Daimler AG.
 

Where Does The Money Come From

The original financing consisted of an $8 billion first-lien term loan and a $2 billion second-lien term loan. Price talk and the original issue discount level on the first-lien loan was 300 basis points over Libor and 99.5. The second-lien loan was expected to be priced at 550 basis points over Libor with an original issue discount of 99, according to price talk.
 

Daimler Benz Got The $7.4 Billion

The loan, which was priced 400 bps over London interbank offered rate, is part of a $7.5 billion term loan that already had been funded by the underwriters to finance the buyout.
 

 Reselling The Bonds

The Zionist brokerage house gets 7% to sell the bonds

Retirees Buy The Bonds

So on a $1,000 bond the stockbroker gets 5%, and the house gets 7%, and cerelebus (Chrysler buyer) gets $880. What it means is that they need to borrow $8.3 billion to get the $7.4 billion to pay Mercedes Benz.

Bonds Aren't Selling

When something doesn't sell you discount it, and now Chrysler bonds are at a 5% discount.