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The first day of reaction to the nomination of Sonia Sotomayor to the Supreme Court made her the Story of the Day again. The coverage of the judge was less intense than day one, however (12 min v 25) and nothing was newsworthy enough to warrant making her the lead of any of the three network newscasts. They all led with the economy: NBC and CBS with the looming bankruptcy of General Motors; ABC with signs of revival in the housing market.

The major development in the General Motors story was the bondholders' rejection of a deal that would trade their $27bn in debt for a 10% share of ownership in the restructured company. CBS' Anthony Mason talked to Jim Modica, one of those bondholders, whose $700,000 purchase of paper was about to be wiped out. Modica calculated that GM's stock price would have to climb to $329 in order for him to be made whole by the deal. The stock currently sells for $1.15.

"It now appears inevitable that General Motors will declare bankruptcy," CNBC's Phil LeBeau announced on NBC. He called the collapse of the bonds-to-stocks deal "the final straw." Altogether the automaker has $88bn in debt and obligations, he reckoned, including $20bn in loans from the federal government. ABC's Chris Bury anticipated that the USTreasury would pony up a further $50bn if bankruptcy happens, ending up with a firm that is 70% nationalized. The healthcare plan for retired union workers has already given up $10bn: "Dental and vision coverage ends June 1st."


Andrew Tyndall 5/28/09 11:45:51 pm

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