Comments on: Elliot vs Argentina is a domestic Argentine issue A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: GermanHoldout Sun, 29 Dec 2013 14:35:39 +0000 Argentina’s nightmare default, this since 2002 ongoing HORROR must finally have an end!

Since 2002, Argentina has not paid a cent to the holdouts!

Beyond the U.S. Hedge Funds there are still tens of thousands retail Holdouts worldwide, most of them from Italy and Germany.

Most of the Holdouts are “before default buyer”, who have bought their bonds at an average of 100% or even over.

President Kirchner (by the way a beautiful women) should solve the holdout problem.

President Obama and the IMF should help and talk to President Kirchner to end Argentina’s Horror-Default.

Probably, also the US Court wants negotiations, and that is why, they STILL left the “stay” to give time for negotiations.

A reconciliation with the holdouts would improve Argentina’s ratings, initiate a firework of investments and also cheaper credits for argentine companies.

Argentina clearly has the capacity to repay the debt to the holdouts after more than a decade! The outstanding debt is only approximately 12 Billion (incl. accrued interest) to the holdouts. It is not much for the 3. largest economy in South America.

The argument:-> “If the U.S. courts uphold the complainant’s position, negative consequences will be felt by the U.S. and the rest of the world. Sovereign debt restructurings will be virtually impossible in the future.”

It is not true because, after Argentina’s 2001 Default all bonds imply the Collective Action Clause (CAC) A collective Action clause (CAC) allows a supermajority of bondholders (75%) to agree to a debt restructuring that is legally binding on all holders of the bond, including those who vote against the restructuring.

BUT, This CAC is NOT implied in Argentina’s defaulted old bonds! Accordingly, Argentina MUST fulfill the bond contracts and repay the debt to the holdouts!

If Argentina and the holdouts made NOW A BINDING AGREEMENT with respect to the “time after” (end of the “Rights Upon Future Offers (RUFO) clause in December 2014), seizure risks and a technical Default would be immediately averted. Argentina could immediately return to the capital market and thus Argentina could refinance the payments to the holdouts, without using reserves.

Holdouts want a simple, clear, secure and an ACCEPTABLE solution.

Holdouts DO NOT want such exotic financial constructs, as they were the swap conditions in 2005 and 2010, with an exorbitant Haircut, with many new bonds, with only Discount bonds above $50000, GDP Warrants etc.,and with maturities in the eternity. Such “shares like” financial constructs are inacceptable.

Following simple conditions might be acceptable for the Holdouts .

– at the latest, on 01/01/2015 (end of RUFO clause) Argentina should repay in CASH 100% of the nominal value of the defaulted bonds, which became due before 2015.

– for the accrued interest between 2002-2015´Argentina should emit new bonds with 50% discount, and with a maturity of 5 years.

By: upstater Mon, 26 Nov 2012 13:02:17 +0000 To say that the debt has nothing to do with Argentina’s period of dictatorship is specious. It is similar to say that the EU mess has nothing to do with WWII.

The country was run into the ground by state terrorism against its own population, enthusiastically supported by the US.

Menem introduced neoliberalism, dollarization and facilitated the gutting or sale to rent-seekers of the country’s industrial and resource base.

Banksters are social parasites and should be treated as such.

By: yrsecretfriend Sun, 25 Nov 2012 20:06:51 +0000 You are welcome Felix.
Glad charting was helpful to your readers.

By: silliness Sat, 24 Nov 2012 21:05:40 +0000 As a completely disinterested party, I think Argentina should be able to pay whoever it wants whenever it wants. They ought to tell the US court to drop dead. Those who hold sovereign debt are hereby warned… the whole edifice is subject to the whims of politicians who can decide they don’t want to pay at any time for any reason. Caveat emptor.

And yes, I am perfectly willing to live with the consequences of such a thing. The vampire squids will just have to adjust. And so will the people of these countries.

By: klhoughton Sat, 24 Nov 2012 17:45:02 +0000 “Judge Griesa might have a surprising amount of power. But Cristina Fernández has more.”

Fortunately. If you want to guarantee that there will never be any more bond issuance using US-based intermediaries, just sustain Griesa’s ruling, guys.

When will the people who (STILL) whine about Kennedy’s 10% excise tax c/r/e/a/t/i/n/g/ t/h/e/ E/u/r/o/b/o/n/d/ m/a/r/k/e/t/ moving foreign bond issuances outside the United States are going to realise that was a minor hiccup compared to this?

By: gito Sat, 24 Nov 2012 14:14:59 +0000 you are not a journalist….all you right is for one side only…

By: MrRFox Sat, 24 Nov 2012 05:19:53 +0000 “The WSJ has not been much better … — a sign that if they put their mind to it, US journalists could really add some value here.” (FS)

As long as FT cover the story well, is it really necessary that every journalist do so? As you say, it’s just a squabble over money among a closed group of people – none of whom ‘wear white hats’. Now the HSBC thing is altogether different – this involves drug-trafficking and homicide by a financial institution that appears to have been a full fledged, legally complicit, willing co-conspirator to all those offenses.

Being a quintessentially US story, kinda sad that no journalist in the great country of ours (if not yours, FS) seems interested in this matter – including you, Scotty. What’s the problem, laddy – cat got your keyboard, son?