Counterparties

Argentina’s default: Here’s what’s happening

July 30, 2014

Argentine economy minister Axel Kicillof

Welcome to #GrieFault day. That’s twitter’s hashtag for the Argentine technical default, caused largely by a series of court rulings by U.S. federal court judge Thomas Griesa, which was triggered this afternoon. That is to say that the ratings agency S&P cut the country’s credit rating to selective default. The country’s representatives are still negotiating with bondholders in Manhattan as of this writing. This was the story yesterday:

Dancing around a default

July 29, 2014

Not signed up for the Counterparties newsletter yet? Click here.

Argentina is down to the wire — the likelihood it will default tomorrow is extremely high. After missing a $539 million interest payment on its bonds on June 30 (previous coverage in the saga here and here), the country had a 30-day grace period to reach a settlement with its holdout creditors — mostly the hedge fund Elliott Management — in order to avoid default. The clock runs out on Wednesday.

Argentina pays

June 30, 2014

Not signed up for the Counterparties newsletter yet? Click here.

When we left off two weeks ago, the Supreme Court denied to hear the Elliott v. Argentina case. Federal district court judge Thomas Griesa’s decision stands, giving the sovereign nation until today to either pay its holdout creditors (who did not restructure their bonds when the country defaulted in the early 2000s), settle with them, or default on its debts again. In the interim, Argentina has attempted to do anything but those three things. “Argentina is not lying when it says that it simply can’t afford to do what the U.S. courts are demanding of it — which is to pay all the holdouts in full,” writes Felix Salmon.

Argentina’s bills come due

June 17, 2014

Not signed up for the Counterparties newsletter yet? Click here.

Argentina lost not one but two Supreme Court cases on Monday regarding paying back bonds that it issued before its 2001 default. First, in what Noah Feldman calls a “legally surprising, financially worrisome, and internationally questionable” move, the court declined to hear Argentina’s appeal regarding the Second Circuit decision last fall. In that case, the court found in favor of Paul Singer’s hedge fund Elliott Management, a “holdout” bondholder that did not agree to Argentina’s debt restructurings in 2005 and 2010 after its 2001 default. Second, and somewhat tangentially, the court found in a 7-1 decision that NML Capital, a subsidiary of Elliott, can seek information about Argentina’s finances to get its money back from the country.

America’s own sovereign debt crisis

October 30, 2013

Welcome to the Counterparties email. The sign-up page is here, it’s just a matter of checking a box if you’re already registered on the Reuters website. Send suggestions, story tips and complaints to Counterparties.Reuters@gmail.com.