The Chrysler mess this week was complicated by a rift between big bulge bracket banks--Goldman Sachs, Citigroup, JPMorgan Chase--and smaller funds, who felt they were denied a place at the negotiating table. The group of smaller firms didn't agree to the deal the big four struck. That was a key factor in the decision to push Chrysler into a bankruptcy proceeding.

The group's debt holdings represents about $1 billion of the $6.9 billion owed to senior lenders. The upstarts include the likes of Perella Weinberg, hedge fund Stairway Capital and Oppenheimer Fund, reports the Washington Post. As of now, it appears as though the group has opened direct talks with the government, Reuters reports. It apparently has made a new offer. None of this stopped the bankruptcy filing--and it did not stop President Obama from delivering a public scolding, calling them a "small group of speculators." Essentially shaming one firm, Perella Weinberg, into accepting the government's terms. The others will continue to hold out for better terms against more junior creditors.

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