>>if you ever met someone who owed their bank a couple million dollars, you would find that the bank will continue to loan them more money, because shutting them off would be bad for the bank as well (for example business loans that allow a company to keep operating).
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>>Oh, you mean like Government Motors? We'll see how that plays out in the end....
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>No, not like that.
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>Let's say I owe the bank $10,000. They want their money.
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>I say "Well, just give me a little more".
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>They say no.
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>That's kind of what you're describing.
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>What I'm saying is in the world of high finance, it gets a little more complicated than that.
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>Let's now say I owe the bank $3,000,000.
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>If my business complete stops running, the bank is out $3,000,000 without much of a chance of getting any of it back.
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>They will happily lend me a measly $50,000 more to keep my head above water because that's the best chance they have of not getting screwed out of $3M.

100% correct, plus a company like GM has downstream dependencies (suppliers etc.) that can have enormous consequences economically, politically and socially.