Frankly, I'm surprised by SCOTUS decision not to decide. In thier two-page ruling, SCOTUS said the law placed a heavy burden on the dissident bondholders to prove why circumstances required their judicial intervention: "The applicants have not carried that burden." That not only sounds like a big cop-out to me, but surely leaves open the long-term effect of the trampling of creditor's rights by powerful forces, like the government, abrogating both contract and bankruptcy law. If the lower appeals court decision doesn't address this problem, bad precedents will have been set that will effect us for decades to come.

The capital markets are not stupid. If they find that there's uncertainty that their contracts will be enforced under the law of the land, they will simply avoid situations where such risk exists--like avoiding the extension of loans to finance the operations of large corporations. Such companies will find new sources of credit, maybe more sovereign loans like from China, if anyone thinks that's a good idea. But the changes resulting from the two auto company bailout/bankruptcies will have their effect. As I've said before, credit officers at many lenders (the Indiana teachers and police retirement funds, almost certainly) will be applying the old idiom, "Fool me once, shame on you; Fool me twice, shame on me".

I'm trying to recall the circumstances of the litigation surrounding the Bush-Gore election. Wasn't that another case that seemed to call out for the more careful review that SCOTUS might have provided? But in the circumstances of a long and high profile delay in the certification of the election, SCOTUS took an easy way out by either not hearing the case or ruling in a pretty shallow way. Am I remembering correctly? (I'm certainly not attempting to reopen any discussion on the outcome of that election. Rather, I'm trying to determine any similarities of the "boldness" of the court in deciding to hear cases that are very important, although highly politically charged and subject to certain time pressures.)