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Argentina Stuns Bondholders With Scorched-Earth "Cramdown" Plan

Tyler Durden's picture




 

With the impasse over the latest Argentina default going nowhere fast, late last night president Kirchner stunned its creditors when she announced what amounts to a cramdown plan for holdouts, in which all bonds would be stripped of their existing indentures and converted to local law bonds. Or, as some would call it, a "scorched earth" transaction that burns all bridges, and goodwill, with the international creditor community and likely leaves Argentina unable to access global capital markets for the foreseeable future.

As part of its transaction Argentina would bypass the order issued by Judge Griesa halting payments to all creditors, not just the holdouts, and resume normalcy for the 90%+ of restructured bondholders while leaving Elliott, Aurelius and the like with little to no recourse aside from holding on to claims which would be two swaps behind, and with essentially no legal standing as it would completely bypass the Bank of New York (whom it would remove as trustee) custodian payment process and allow Argentina to make payments directly to those creditors it sees fit.

In essence, what Argentina plans to do is the opposite of what Greece did in 2012 when it defaulted on existing bonds, and swaped over into English-law bonds as an incentive for existing creditors, in effect promising it would never do it again. What Argentina has just shown is how easy it would be to "cramdown" bondholders who thought their "strong" covenants were safe when in reality all it takes is a government order to strip any and all of their indenture protection. Needless to say this has a very negative implication for Argentina's future ability to raise capital in the international arena for the near, and longer-term (at least until the ZIRP yield junkies come crawling back hoping to collect 10% if only for one year; the year after that will be some other Portfolio Manager's problem).

According to Bloomberg, the government will submit a bill to Congress that lets overseas debt holders swap into new bonds governed by domestic law with the same terms, President Cristina Fernandez de Kirchner said in a nationwide address yesterday. Payments will be made into accounts at the central bank instead of through Bank of New York Mellon Corp., the current trustee.

Holders of Argentina’s $30 billion of overseas bonds have been in limbo since U.S. District Court Judge Thomas Griesa blocked the nation’s attempt to pay $539 million in interest due by July 30. His ruling was meant to compel Argentina to resolve unpaid debts from its 2001 default. While most creditors agreed to provide debt relief, hedge funds led by billionaire Paul Singer’s Elliott Management Corp. refused and successfully sued for full repayment in U.S. court.

 

“The bigger picture hasn’t changed at all,” Will Nef, who helps manage $3.2 billion of emerging-market debt at Union Bancaire Privee in Zurich, said by phone today. “Argentina is still locked out of international credit markets because the issue with the holdouts remains unresolved.”

It may well be locked out, but if this plan goes through, it will remain in the good graces of its restructured bondholders, while taking the last bit of leverage the holdouts have. However, what is worse are the negative implications for international bondholder contractual terms.

Bloomberg has more on the details of the actual proposed swap:

Argentina plans to create a separate account for the holdout creditors such as Elliott, who own 7.6 percent of debt from 2001 and didn’t accept the government’s previous debt swaps. Payments for holdouts would be deposited under the same terms as the rest of its restructured debt, regardless of whether they decide to accept the swap. 

 

Creditors opting to keep their notes will also get payments locally under the plan, Fernandez said yesterday. Stephen Spruiell, a spokesman for New York-based Elliott, didn’t immediately reply to an e-mail seeking comment.

 

Daniel Pollack, a court-appointed mediator for the talks between Argentina and the holdouts, didn’t immediately return an e-mail seeking comment on the government’s proposal.

Curiously, alongside the announcement, with the situation suddenly quite "fluid", ISDA pushed back the date for the auction to settle Argentina’s credit-default swaps to after Sept. 2 from Aug. 21, according to its website. Argentina’s failure to pay interest on its bonds triggered a credit event and settlement of $1 billion of the default swaps.

Amusingly, as Credit Suisse's Casey Reckman summarizes, and who was quite negative on the announcement as per his overnight note, the Argentina plan would likely result in what is a contempt of court to Judge Griesa. From Bloomberg:

  • Foreign-law exchange bonds could be dropped from main Emerging Markets bond indexes if operation is completed, which could lead some investors to sell their holdings, Credit Suisse economist Casey Reckman writes in report.
  • Strategy could indicate reduced govt willingness to settle with holdout creditors once the Rights Upon Future Offers (RUFO) clause expires at year end
  • Sees increased risk that govt will leave the holdout issue for the subsequent administration to resolve
  • Debt swap would likely violate U.S. Judge Thomas Griesa’s orders against evading his pari passu ruling, which could result in Argentina being held in contempt of court
  • U.S. based financial intermediaries and investors could be wary of risking contempt themselves if they were to participate
  • While contempt of court may have few practical implications, it could further limit the already reduced potential for foreign financing flows until situation is resolved
  • Renewed motivation for settlement would probably have to be driven by economic circumstances, namely a significant decline in international reserves that threatens govt’s ability to continue servicing its USD-denominated obligations

In other words, in order to preserve some optionality, what is next on Elliott's agenda, would be nothing less than crushing the Argentina's economy, depleting the central bank's reserves, which at last check were just under $30 billion, or a little more than Elliott's AUM, and send the CFK administration packing. 

Can he do it? We eagerly await to find out. In the meantime, any Argentina "assets" abroad, be they naval or otherwise, are once again fair rehypothecation game.

Finally, keep an eye on the Argentina bond market where this development will likely play out on accelerated basis, now that Argentina has confirmed it will play "scorched earth" hardball with creditors.

 

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Wed, 08/20/2014 - 09:01 | 5119234 booboo
booboo's picture

More like stink finger with gold colored paint.

Wed, 08/20/2014 - 08:57 | 5119221 yogibear
yogibear's picture

Once Argentina defaults it's a clean slate.

Smart move.

 

Wed, 08/20/2014 - 09:02 | 5119235 Anarchy 99
Anarchy 99's picture

Not default: just eliminating the US banking system as the middle man.

 

"Remove the Bank of New York as agent" and to pay via the Argentina Banco de la Nación

Wed, 08/20/2014 - 09:22 | 5119345 Pure Evil
Pure Evil's picture

Ah yes, playing the same game as the money changers in the Eccles Building.

Use inflated paper money.

Wed, 08/20/2014 - 11:10 | 5119981 Kirk2NCC1701
Kirk2NCC1701's picture

Pure Genius!  But the parasites in the Eccles Building will call it... Pure Evil.

;-)

Wed, 08/20/2014 - 12:03 | 5120285 Anarchy 99
Anarchy 99's picture

I agree, pay with inflated to near zero money, they all do it, but fuck the bond holders (banks) it's the people that get screwd unless they protect themselves, (metals, food, energy)

Wed, 08/20/2014 - 08:59 | 5119227 darkpool2
darkpool2's picture

Maybe less government borrowing all around would be a great thing.....rely mostly on country to country infrastructure development loans and fund everything else ( or not ) through general domestic revenues. Deleveraging could be a bitch.......for some !

Wed, 08/20/2014 - 08:59 | 5119229 forgottenozonehole
forgottenozonehole's picture

Ms  C. Fernandez de Kirchner  the one and only president with hard balls,

Wed, 08/20/2014 - 09:23 | 5119349 Pure Evil
Pure Evil's picture

Not something to discover when you're paying $5000 a night.

Unless of course you're into to that.

Wed, 08/20/2014 - 11:15 | 5120017 Kirk2NCC1701
Kirk2NCC1701's picture

Perhaps not 'balls' (cojones), but a BACKBONE, i.e. Resolve.

Too much testosterone makes you stupid, aggressive and shrinks the penis.  Look it up.

Wed, 08/20/2014 - 08:59 | 5119231 Bernanke'sDaddy
Bernanke'sDaddy's picture

I bet they'll be able to access BRICS credit, no problema.

Wed, 08/20/2014 - 09:10 | 5119273 Joe A
Joe A's picture

Indeed. Enter BRIC. Then the two largest South American countries (Brasil and Argentina) are in the fold of the BRIC and they will bypass the banks in the West.

Wed, 08/20/2014 - 09:00 | 5119232 himaroid
himaroid's picture

AFRICTINA!

Wed, 08/20/2014 - 09:07 | 5119260 Joe A
Joe A's picture

More like BRICTINA

Wed, 08/20/2014 - 09:02 | 5119236 Sudden Debt
Sudden Debt's picture

In the end, all the countries are broke and most also hold each others debt as a "lifeline"...

morons...

We're broke...

We're all promised a shitload of stuff in the future...

And the only thing to keep the game going for a bit longer is just to confiscate all private assets minus the "economical invested assets" "so the economy can keep going".

Now, it sounds weird but there's actually European countries telling this is a good idea.

 

Wed, 08/20/2014 - 09:32 | 5119395 LawsofPhysics
LawsofPhysics's picture

"In the end, all the countries are broke"  -- yes, but standards of living vary, and that's what this is really about, well that and power and control over the resource that make those standards of living possible.

Wed, 08/20/2014 - 14:04 | 5121060 TNTARG
TNTARG's picture

Well, fact is Argentina isn't broke. And intends to stay unbroken.

Wed, 08/20/2014 - 09:01 | 5119239 Chuck Knoblauch
Chuck Knoblauch's picture

This is news?

Argentina has been defaulting on its debt for decades.

So, what's new here?

Wed, 08/20/2014 - 09:07 | 5119255 Anarchy 99
Anarchy 99's picture

Chuck, read the article again, 

Wed, 08/20/2014 - 09:26 | 5119361 Pure Evil
Pure Evil's picture

I think the ultimate goal is to default using worthless inflated Argentinian pesos or whatever they call the official Toilet Paper in Argentina.

Of course, where did they learn that little trick from?

Certainly not the eggheads in the Eccles Building!

Wed, 08/20/2014 - 09:58 | 5119562 Chuck Knoblauch
Chuck Knoblauch's picture

Who in their right mind would "invest" a single Peso in Argentina?

Wed, 08/20/2014 - 09:05 | 5119243 DarthVaderMentor
DarthVaderMentor's picture

The first step of the 12 Step Sovereign Plan to Financial Soberness............Stick it to the financial backers of the "Pusherman".....

Wed, 08/20/2014 - 09:06 | 5119246 TTaco
TTaco's picture

Smuged Faced Bureaucrat should be hanged by Argentinian people:

I would perform a nasty execution on her!
http://youtu.be/xK4HbnGLMxE

Wed, 08/20/2014 - 09:06 | 5119249 Latitude25
Latitude25's picture

Loss of international confidence in Argentina yields massive peso devaluation and hyperinflation.  Pay off the debt with valueless pesos.  Good plan.

Wed, 08/20/2014 - 09:28 | 5119372 Pure Evil
Pure Evil's picture

Yep, the elites already got their skim off the top long ago.

Now its time to tell everyone else to go fuck themselves.

Wed, 08/20/2014 - 09:07 | 5119262 fzrkid
fzrkid's picture

Raise taxes, implement a socialized health insurance plan and establish a federally run retirement savings... Once those are funded, borrow from them until they are negative than borrow money using that as collateral.

 

Oh yeah and PRINT PRINT & PRINT

Wed, 08/20/2014 - 09:58 | 5119555 Accounting101
Accounting101's picture

Will that socialized health insurance plan cut costs by half to two-thirds of what we pay now? I'm tired of paying more for less.

Wed, 08/20/2014 - 10:17 | 5119669 Majestic12
Majestic12's picture

I'll tell you the answer, if you can tell me how Obamacare, being a golden gift to the insurance insdustry, is "socialized"???  Socialized, is when only the well-off have insurance...and Clem, Tater and Clunk, with no insurance, wind up in the ER with horrific burn trauma due to their exloding meth lab....who pays?  Yeah, tax payers...

The only "socialized" part of the "Affordable Care Act" was "the public option"..which was quickly put to rest...why?  Because it would have cut the insurance industry "out of the loop" and paid doctors directly.

It's all about perspective...if you "pay" so much, you must be an employer...the publiic option is in "your" interest...even if you current ideology "ain't"....

If you have equity in the insurance industry...again, your ideology is contradictory, because you support socialism for the wealthy....antitrust exempt, cancellations and non payouts...its guaranteed profits...nice gig, it you can get it...but I don't see anything like the protection that the insurance indsutry enjoys, even being considered for the smal business community...where America's real opportunity lies and would put a big dent in the need for anything "socialist"....

Wed, 08/20/2014 - 11:19 | 5120030 Accounting101
Accounting101's picture

No, I simply support paying health care costs inline with the rest of the world. I never like paying more for less. It's quite dumb. No amount of pseudo-intellectual bullshit will make

Wed, 08/20/2014 - 09:09 | 5119271 Everybodys All ...
Everybodys All American's picture

Argentina deciding on bankruptcy and their own future rather than the banks or creditors deciding it for them. This is the future for sovereigns whether anyone wants to admit it right now or allow for it is another thing. Spain, Portugal, Greece, Italy, Japan, US, Ireland, UK, France, and even China will all have to address creditors the same way some day without serious spending reforms.

Wed, 08/20/2014 - 09:29 | 5119383 Pure Evil
Pure Evil's picture

Does WW3 start the day the US defaults with China, or the day after?

Wed, 08/20/2014 - 09:37 | 5119428 LawsofPhysics
LawsofPhysics's picture

China will have dumped all their U.S. paper by the time the U.S. defaults.  Please, their leadership/oligarchs have been "in the club" since 1971.

Wed, 08/20/2014 - 10:01 | 5119572 nodhannum
nodhannum's picture

I am a little pussled here @Everybodys All...exactly which Argentine bankruptcy are you referring to...I get them all confused.  They just seem to run together.

Wed, 08/20/2014 - 09:08 | 5119272 laomei
laomei's picture

Other nations seize Argentina's assets, Argentina simply responds by seizing foreign assets.  Simple enough.

Wed, 08/20/2014 - 09:09 | 5119275 nah
nah's picture

Give me control of a nation's money and I care not who makes it's laws

.

-President Cristina Fernandez de Kirchner

Wed, 08/20/2014 - 09:10 | 5119276 jmcadg
jmcadg's picture

Starting the ball rolling. So Argentina frozen out eh. And Elliot et al are going to move to what - Spain? And when Spain default ... Italy and when ... in the end Elliot will have fuck all left. I like the idea. Scum.

Wed, 08/20/2014 - 09:12 | 5119285 Irishcyclist
Irishcyclist's picture

Kurchner is starting to play hardball. Lets hope that Argentina has the fortitude to withstand the affects of this policy because the other side will stop at nothing to try to inflict more pain. If more nations took the same lead as Argentina, there would be grounds for real hope that the casino might just get finally smashed. Here's hoping.

Wed, 08/20/2014 - 09:51 | 5119498 Accounting101
Accounting101's picture

Yes sir!

Wed, 08/20/2014 - 12:07 | 5120317 Anarchy 99
Anarchy 99's picture

Putin (briics) was in argentina not too long before this wasn't he?

 

Wed, 08/20/2014 - 18:45 | 5121786 Snake
Snake's picture

 

 

 

Putin was in Buenos Aires on July 12th.

http://www.bbc.co.uk/mundo/ultimas_noticias/2014/07/140712_ultnot_argent...

 

Xi Jinping was in Buenos Aires on July 19th.

http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1176627.shtml

Wed, 08/20/2014 - 09:13 | 5119289 NoWayJose
NoWayJose's picture

Why is this negative for Argentina?  The bondholders who agreed to the restructuring will get what they agreed to.  The only 'negative' is to the New York judge and the holdouts.  If anything, I would view that as a 'positive'.  Of course, anyone lending money to Argentina in the future is going to include some protections - but that would have to happen anyway.

Wed, 08/20/2014 - 22:02 | 5123445 WhyWait
WhyWait's picture

Consider, Argentina is committed to paying the bondholders who agreed.  Can't pay them through court because that's blocked so will have to pay through other channels.  US, courts are already starting to move toward locking Argentina out of credit markets, dollar exchanges.  Will move to the level of sanctions that block Argentina's ability to earn dollars.  

Argentina's next move?  If they're being squeezed too hard on earning dollars, they could switch to paying in Pesos or Roubles.  Banks would have to like it or lump it.  Same with more recent loans, when they have to be rolled over.

 

 

Wed, 08/20/2014 - 09:15 | 5119301 Who was that ma...
Who was that masked man's picture

Even so, President Kirchner is still a PILF.

Well, woulda been better 30 years ago but still.

Wed, 08/20/2014 - 09:17 | 5119306 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

They got plenty of productive farmland. Sure Russia would import some of that food.

Hard tangible assets like food producing land guarantee someone will deal with you.

Wed, 08/20/2014 - 09:44 | 5119462 Duude
Duude's picture

Having only  a few countries that will deal with you puts the other countries in a position to demand discounts. Regardless, Argentina, like most nations, don't have enough hard currency running through their economies to keep them afloat for long.  Look at Venezuela. Even with their huge energy stores, the country is circling the drain.

Wed, 08/20/2014 - 12:08 | 5120324 Anarchy 99
Anarchy 99's picture

I doubt it, they have huge oil reserves. 

Wed, 08/20/2014 - 09:58 | 5119554 nodhannum
nodhannum's picture

Productive farmland, natural resources don't mean crap unless one has the vision, dicisipline and fortitude to do something creative with it.  If you join the FSA, there will never ever be enough farmland etc.  Oh, and bye the way, the Russians and Chinese get very upset when someone stiff them.

Wed, 08/20/2014 - 12:06 | 5120307 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

It is all in how you structure the deal. Both the Chinese and Russians know how to manage farmland if need be as a condition for doing business. I'm sure they would be happy pay full price for a discounted lease on a piece of land to put a naval base on it. There are a lot of ways to dance here without needing a middleman or money/debt changing hands initially to structure a deal.

Wed, 08/20/2014 - 09:17 | 5119308 IndianaJohn
IndianaJohn's picture

I issue my own currency to myself, for trade between my pockets, and pay 0 (zero) interest on my currency. I have another "reserve currency" in checking that I use when I must import goods or services. I pay no intrest on that currency either. I see no reason why producing nations can't do the same.    

Wed, 08/20/2014 - 09:18 | 5119321 youngman
youngman's picture

I have firends here in Colombia that have properties in Argentina....none of them want to talk about it now....5 years ago it was so great....they spewed great things about it....now they cant sell it..and if they did..they cant take their money out....there used to be some investment letter guy that had a ranch down there...he always said it was a great place to invest....I have not heard form him in the last two years or so...his letter is no longer emailed to me......guess his advice was not so good...

Wed, 08/20/2014 - 09:31 | 5119396 Pure Evil
Pure Evil's picture

You might find him in Chile spewing the same cock and bull story to new suckers.

Wed, 08/20/2014 - 11:53 | 5120213 samcontrol
samcontrol's picture

yep, i am buying in the south of Chile and south of Argentina..

If anyone is thinking where can i get my biggest bang for my buck ?
The answer if you like wine and good barbecue .Argentina.
I wanted to leave but decided it was a dumb move.

Thu, 08/21/2014 - 09:51 | 5124785 Gromit
Gromit's picture

Close to "Vaca Muerte"

Wed, 08/20/2014 - 11:09 | 5119982 daedon
daedon's picture

Funny, I tried to unsuscrivbe but I keep on getting their crap. If it's casey research, don't worry about it, he's gone to the Dark Side and now scoffs anyone who believes the price of Gold is manipulated.

Wed, 08/20/2014 - 13:36 | 5120883 TNTARG
TNTARG's picture

Hold them.

Properties in Argentina are gonna increase values soon enough.

Wed, 08/20/2014 - 09:23 | 5119346 anachronism
anachronism's picture

This should prove to be a benefit for Argentina. And Argentina's actions are likely to be used as a model for other countries, which find themselves crippled by debt, rather than the actions taken by Greece.

Sovereign debt should be just that: sovereign. The laws and practices of other countries should have no jurisdiction over the bond issues of a sovereign state. If this makes lending money more risky for the lender and more expensive for the borrower, so be it.

I read somewhere else that Argentina wanted to appeal the U.S. judge's ruling at the International Court; but the United States refused. I suspect that the standing of Elliot Singer, and his kind, as "vulture capitalists" would be considerd relevant by such a court, whereas the "sanctity" of the bond owner was of overriding importance in New York.

Wed, 08/20/2014 - 11:32 | 5120101 disabledvet
disabledvet's picture

Meh. Trying this in a court in Europe looks even worse actually. "Bail ins" as the answer? They'd probably demand any new debt be denominated in euros as well.

Sounds to me like they're gonna keep having a really bad inflation problem down there for a long time.

Wed, 08/20/2014 - 09:26 | 5119362 Atomizer
Atomizer's picture

Investing hard earned money into a Alice in Wonderland facade. 

Wed, 08/20/2014 - 09:32 | 5119393 Merca Visca
Merca Visca's picture

You guys at Zero Hedge are very funny: what Argentina just did is making sure bond holders will get paid, because the US is not a trustable payments operator any longer since judge Griesa CONFISCATED  the last payment we made. So relax and enjoy your new status, haha.

Wed, 08/20/2014 - 09:33 | 5119408 Pure Evil
Pure Evil's picture

What country do you live in?

I think we need to bomb you back to Democracy.

Plus, we're having a Hellfire missile firesale, two for the price of one, give us your addres and we'll deliver them by drones.

Wed, 08/20/2014 - 09:37 | 5119415 NoWayJose
NoWayJose's picture

Now project that same thought forward - when the US will no longer be a trustable payments operator for ANYTHING!

Can you see that day coming when a company or individual moves money in the US financial system and the 'government' detemrines that you got 15% of that from business with Russia - so they confiscate that?

Wed, 08/20/2014 - 12:40 | 5120523 AurorusBorealus
AurorusBorealus's picture

Didn´t you read Paul Singer´s "letter to investors" here?  It´s pretty clear Zerohedge is one of those investors, and from the looks of this article, those CDS may not be quite as secure as Paul, the Pirate, Singer originally thought.

Wed, 08/20/2014 - 09:32 | 5119398 Latitude25
Latitude25's picture

OK ZH.  Time for another Paul Singer article telling us about fiscal responsibility.

Wed, 08/20/2014 - 09:40 | 5119441 Atomizer
Atomizer's picture

Run along youngster, your mom needs you to refill the EBT Card by using fraudulent means. 

Wed, 08/20/2014 - 09:35 | 5119419 grunk
grunk's picture

A bad credit risk locked out of credit markets?

Outrageous.

Wed, 08/20/2014 - 09:35 | 5119421 Atomizer
Atomizer's picture

Thomas goes on a date with Ms Lamp post.

U.S. District Court Judge Thomas Griesa blocked the nation’s attempt to pay $539 million in interest due by July 30. 

Wed, 08/20/2014 - 09:38 | 5119433 Duude
Duude's picture

I think this will serve all other countries. We need a scorched-earth policy from one country just to demonstrate to the world the ramfiications of turning one's back on contract law. Make no mistake, Argentina won't have access to foreign loans again till maybe the second half of the 21st Century. Sure, they'll be able to borrow a few bilion from China but Chinese loans are contingent upon Argentina buying from China only. That will leave the country in serious need within months. Yes, populist economic stupidity may appear to be ruling the day in Argentina today, but the decline of the country's economy will make Greece look like a day at the beach.

Wed, 08/20/2014 - 09:42 | 5119451 Latitude25
Latitude25's picture

Many S American countries are cutting deals with China.  They are resource rich also.  Think again.  The West is bankrupt anyway.

Wed, 08/20/2014 - 09:45 | 5119466 Irishcyclist
Irishcyclist's picture

Time may tell. Argentina offered a settlement but our friends tried demanding their pound of flesh. In taking this route Argentina need to be sure that they can stay the course.

Wed, 08/20/2014 - 11:26 | 5120068 AurorusBorealus
AurorusBorealus's picture

Thus far the "default" and the debt negotiations have had no noticeable impact on the economy here... though there are indications that the economy is slowing, it does not seem, to me at least, that this is in any way related to the debt settlement and "default" but more owing to internal issues.  There has been a noticeable expansion in bank credit here the past few years for automobiles and houses, which pulled forward a good bit of production.  That is now retrenching... shame Argentina felt the need to begin pulling forward production with credit.  We do just fine without much bank credit.

Wed, 08/20/2014 - 09:39 | 5119439 Latitude25
Latitude25's picture

Now Eliot Capital must be ready to collect on their Argentina CDSs.  Must have been the plan all along.

Wed, 08/20/2014 - 10:19 | 5119505 robertocarlos
robertocarlos's picture

Won't that cause cascading defaults? We'll have to bail out the insurnace companies.

Wed, 08/20/2014 - 09:48 | 5119474 zipit
zipit's picture

They will be right back at the international creditor trough soon enough.  The greedy pigs (i.e., Wall St, etc.) come back again and again because they earn debt origination commission regardless.  In fact, they probably earn a higher percentage commission on Argentina after this cramdown.  It's win-win for eveyone except the high-stakes douche bags who thought their fancy lawyers and power plays would do shit down south.  Haha

Wed, 08/20/2014 - 09:48 | 5119478 Casserole of no...
Casserole of nonsense's picture

If I were a sovereign and some bankster was trying to blackmail my entire country, he get a bullet in the back of his head. And his whole family too. I don't know why she puts up with it.

Her people would love her. No one else would try that blackmail shit again. And the world would be rid of one more bankster. Win win win.

Wed, 08/20/2014 - 11:23 | 5120060 AurorusBorealus
AurorusBorealus's picture

Which is why my advise to the Argentine government is to bend heaven and earth to bring Paul Singer to trial in Buenos Aires as a pirate for his seizure of the Libertad: even if this means an Eichmann-style commando raid on his house.

Wed, 08/20/2014 - 09:50 | 5119491 BIHM
BIHM's picture

Unable to sell bonds to the international markets eh?? Not buying that folks. I could wrap up a pile of shit stamp debt security on it and the banks would trade it around the marketplace like it was the hottest thing since sliced bread. The point is they don't give a fuck what the 'security' is. The only thing that matters is the spread. Look at goldmans new opaque dynamic securities. Come ppl. Assets are nothing more than marbles these suited children trade on the street. The underlying values are irrelevant. Spread is the only thing that matters.

Wed, 08/20/2014 - 09:52 | 5119507 Fix It Again Timmy
Fix It Again Timmy's picture

I create money out of thin air and loan it to you and you must then pay me interest - In contractual law, the consideration offered by both parties must be of substance.  Money created out of thin air is not of substance, hence the contract is essentially void...

Wed, 08/20/2014 - 13:31 | 5120829 TNTARG
TNTARG's picture

Furthermore, little money came to Argentina.

Most of the "sovereign debt" is interests upon interests  from plans after plans imposed by IMF and partners, as "Plan Brady" and many others.

I'm with the gvt on this one. This financial casino causing poverty and death must be stopped.

Do you find acceptable the fact that the US, the EuroZone coutries, have to BUY the notes from PRIVATE bankers by selling sovereign bonds? Is that in any way logic, fair, sustainable?

Countries should be able to print they're own notes according to their own economy. The US should. Why buying bucks from the FED?

Wed, 08/20/2014 - 10:03 | 5119585 yogibear
yogibear's picture

About time someone had the balls to stick it to the banksters.

LOL, let's see how the insurers backing these bonds end up.

Usually an AIG-like company inures or derivatives. Let's see if the backing was over-subscribed again and blows up. 

Kaboom on over-subscribe insurance against the debt.

 

Wed, 08/20/2014 - 10:03 | 5119593 RabbitChow
RabbitChow's picture

Well, I sincerely hope that Argentina has gotten all of its gold back from NY and London.  At least that way they would have access to capital markets with gold collateral.  

Or is Elliot going to try to have Argentina's gold seized.

Wed, 08/20/2014 - 10:09 | 5119624 RabbitChow
RabbitChow's picture

I think it would be easy, too, for Argentina to set up settleent accounts with the new BRICS bank.  No longer any need to access the uSD for payents of any kind.  So oo want your change in Rubles, Reals, Rupees, or Yuan, or how 'bout Rand?

Wed, 08/20/2014 - 10:08 | 5119628 RaceToTheBottom
RaceToTheBottom's picture

is Argentina pulling an Iceland?

Wed, 08/20/2014 - 11:38 | 5120135 AurorusBorealus
AurorusBorealus's picture

Argentina pulled an Iceland in 2002.  Of course, all the von Mises people love Iceland (because they speak a Germanic dialect and are blond) and hate Argentina, even though the countries have pursued, basically, the exact same path.  Of course, Elliot Capital Management did not hold Iceland debt, also.  This has a lot to do with all the negative press about Argentina.

Wed, 08/20/2014 - 17:06 | 5121962 honestann
honestann's picture

Well, you're probably right to an extent, but most liberty-oriented folks I've chatted with about Argentina have a very two-sided (or many-sided) view of Argentina.  They think Argentina is a great place with a lot of great people, but they also think their leaders are psychotic, sociopathic predators.  But also, too many Argentina people vote for handouts (and thus vote against their productive neighbors), which is how all those horrible leaders get elected.  This attitude about Argentina is, of course, fairly close to their attitude about the USSA, which pretty much has similar problems in many regards.  Hopefully Argentina does not copy the USSA and militarize and radicalize their police.

Wed, 08/20/2014 - 10:13 | 5119646 esum
esum's picture

soon to align with russia china brazil n.korea 

Wed, 08/20/2014 - 10:43 | 5119831 Yancey Ward
Yancey Ward's picture

Well, unless Argentina keeps all of its funds outside the US, the holdouts still have options.  However, I think Argentina has taken the right first step here.  A nice clean default is on the way.

Wed, 08/20/2014 - 10:44 | 5119839 The Duke of New...
The Duke of New York A No.1's picture

When you buy debt from former debt Deadbeats don't expect to come out whole.

Wed, 08/20/2014 - 10:45 | 5119841 tradewithdave
tradewithdave's picture

Sovereignty... This isn't your father's Oldsmobile.

Wed, 08/20/2014 - 11:39 | 5120136 disabledvet
disabledvet's picture

This action did make me think of General Motors back in 2008. But they don't even have a GM in Argentina...let alone a Tesla.

Again...not sure I would be advising this course of action. "Just don't answer the phone" sounds better to me...

Wed, 08/20/2014 - 10:46 | 5119847 tradewithdave
tradewithdave's picture

BRICAS.... Espanol for BRICS

Wed, 08/20/2014 - 11:20 | 5120042 vyeung
vyeung's picture

me think the financial void will be filled by the BRICS central bank.

Wed, 08/20/2014 - 10:49 | 5119866 WhyWait
WhyWait's picture

Tyler, who has a knack for spotting crucial world-historical events way ahead of most anyone else, has been directing our attention to Argentina for a while now.

As is quickly becoming apparent, Argentina's move is a direct challenge not just to a New York judge or some Wall Street investors, but to the Empire itself.  It's not purely accidental that Argentina should be the first vassal state to do this.  The Empire could and would have squashed Greece like a bug last year, before the BRICS development bank, before Russia's challenge to the dollar, and given its size and location.  The Empire must and will try to crush Argentina now, because 100 other countries are watching and will attempt their own breakouts if they escape.  

Argentina is much easier to defend than Greece, and much has changed in the world over the past year. Argentina is much larger, better organized and more self-sufficient.  Of the US-controlled nations from which military aggression could be launched, Paraguay could easily be pressured by Brazil and Chile is on the other side of the Andes Mountains.  Since the fall of the Soviet Union the Medeterranian is virtually a US-owned lake, but the only naval base the Empire has near (or, arguably, inside) Argentina is in the Falklands.

The greatest threat Argentina faces is from its own military, with its ties to the US and a history of US-supported coups.  That same military however does have a recent history of challenging the Empire over the Falklands.  The Argentine government and leaders must move quickly to reorient its military toward Russia, China and especially Brazil, and to purge or sideline the officers who are known to be overly tied to the Pentagon and the US Embassy.  

It seems like everyone on this site loves to diss the government of Venezuela.  But the turning poiint there was when the Venezuelan military, with US help and direction, staged a coup and took President Chavez prisoner, and the junior officers and rank and file troops rebelled and in 24 hours forced the top brass to back down.  That was the critical event when Venezuela passed outside US control.  It was possible because the entire people, including the members of the armed forces, were part of the national conversation about Venezuela's dilemma, about Latin America's dilemma.  

Argentina will soon face such a moment.  The future is unknown, but the formation of the BRICS bank has radically improved their odds.  This is a critical moment for Russia, China, India, Brazil, South Africa and other Latin American nations, a fateful test of their understanding and commitment to the project they have declared.

 

Wed, 08/20/2014 - 11:29 | 5120094 AurorusBorealus
AurorusBorealus's picture

I can tell you, from first-hand observation, (having spent a week in a paratrooper baracks here... don´t ask why... it´s a long story), that the Argentine military is not really up to the task of taking on the empire.  As you point out, however, the empire has not exactly boxed in Argentina with military bases, so the empire would be stretched very, very thin trying any sort of operation here.  That being said, as a U.S. expat, living in Argentina, I sure hope the empire does not come this way.

Wed, 08/20/2014 - 11:39 | 5120137 WhyWait
WhyWait's picture

Interesting.

The more critical question in the short run is what's the conversation in the barracks? What are the troops and junior officers thinking and saying about the US, the Bankers, Argentina's dilemma?  Will they defend a popular patriotic and nationalist Argintine government?  Will they obey orders to overthrow it? Will the top brass give those orders? 

The situation will no doubt evolve before that decision point is reached, but it's not too soon to look for clues.

Wed, 08/20/2014 - 12:00 | 5120263 AurorusBorealus
AurorusBorealus's picture

The Argentine position on their international debt, their history, and their current government varies considerably, but in general, they are more aware and give more thought to these issues than, say, the average American.  Many Argentines know that the CIA and Wall-Street were involved in corrupting their government and involved in the accumulation of debt.  They also know, however, that local, corrupt politicians were equally or more culpable.  In fact, 2 years ago, there was a national month of prayer, in which ever church in Argentina prayed to end corruption in their government.

They do not really hold much of a grudge, surprisingly, against the U.S. and generally view the U.S. as something of an ally.  They generally regard Wall Street as a separate entity and hold the "vulture funds" (los fundos vuitres) in absolute contempt for not accepting a "conpromiso".  The general consensus is that Argentina should repay its bondholders under the terms of the 2005 settlement.  It was a "conpromiso," which means a compromise- but also a promise, to repay.  The word "conpromiso" is very important, connoting responsibility, dependability, maturity, and so forth.

The military are not great fans of the Kirchner government, as they have had their funding cut several times under the Kirchners.  Their equipment is dated and worn at this point and they lack some basic things.  The paratroopers with whom I stayed were greatly interested in all things U.S. and Europe, especially how the U.S. military conducts itself and the history of the U.S. military (I was a history professor in the U.S., so I could explain the history of the U.S. and European militaries fairly well).  Some of the older officers recalled, with great fondness, their deployment alongside U.S. soldiers as part of UN peacekeeping force in Bosnia. That being said, there is tremendous national pride here, and they would defend Argentina tooth and nail with what they have.

Wed, 08/20/2014 - 14:09 | 5121099 WhyWait
WhyWait's picture

They don't understand how our government is controlled by the Banksters and Vampire Billionaires then?

How would their attitude change if Argentina was able to start buying military equipment (and training) from the BRICS, paying in Argentine Pesos?  (Which is just what the Kirchners and BRICS should do, starting right now, imho)

Wed, 08/20/2014 - 12:14 | 5120365 Anarchy 99
Anarchy 99's picture

VERY WELL WRITTEN +1000

Wed, 08/20/2014 - 19:12 | 5122640 emersonreturn
emersonreturn's picture

whywait,

 

i don't think it's entirely by chance.  putin had visited argentina prior to visiting brazil.  it's possible they discussed the idea of a bric bank, as well, as argentina's options, and how best to play them.  dewy c howe's idea of a russian/chinese military outpost in argentina would be highly challenging to both uk and usa.

Wed, 08/20/2014 - 10:59 | 5119919 q99x2
q99x2's picture

Hooray Argentina.

Jump bankster jump.

Wed, 08/20/2014 - 11:04 | 5119951 Hellone
Hellone's picture

once again stupid whitey goyim no see THE TRUTH! Argentina was one of the richest nations per capita of the 20th century. Then here come the unholy Talmudic hordes of babylon with another round of scheming and scamming!.....

then BOOM! OVERNITE ARGENTIANS CURRENCY HYPER INFLATED ARGENTINES WENT TO BED ON FRIDAY PARTIED SATURDAY AND SUNDAY AND MONDAY WOKE UP BROKE AND HOMELESS. prominent people we aint talkin DARKIES that whitey goy hate so much we are talkin doctors, lawyers dentists who just over the weekend were wealthy with not a care in the world! This is act here today is not an act of schemery AS SOME OF THE STUPID DUMB WHITEY GOYIM ARE SUGGESTING!! this is a country in desperation that is essentialy relying on Eastern Promises that they will be able to get a chance to rebuild and back on their feet!

Wed, 08/20/2014 - 11:32 | 5120104 AurorusBorealus
AurorusBorealus's picture

Don´t believe the Wall-Street propaganda.  The Argentine economy has been growing for 8 years now, up until recently, without any help from the international financial community.  We will survive down here.

Wed, 08/20/2014 - 18:27 | 5122427 Monty Burns
Monty Burns's picture

A lot of people have told me that Jews were the main cause of Argentina losing its great wealth.  Is this true? I see no evidence for it but don't have much information either way.  Just askin'.

Wed, 08/20/2014 - 11:18 | 5120034 vyeung
vyeung's picture

Shaft wall street. Sounds good to me.

Wed, 08/20/2014 - 11:28 | 5120082 besnook
besnook's picture

her life is in danger. i hope her security is as good as chavezs'. they still got to him with the cancer pill but he lasted long enough to initiate the bolivar revolution and make it stick. if greece and a dozen other nations get the idea that all they have to do is default and refinance with the brics bank lloyd and jamie will jump(wishful thinking).

what are they going to do? the empire neglected to cultivate a cia sponsored rebel group to provide the excuse for a military repossession of argentina.

curious how the pnac neocons neglected south america in their plan. they have always been arrogant about south america being a backwards backwater and south america may be where the multipolar revolution is born.

Wed, 08/20/2014 - 11:36 | 5120120 AurorusBorealus
AurorusBorealus's picture

Yes... Christina is brave and probably in danger.  And yes, I suspect the CIA is beginning to take a look at their old contacts here.

Wed, 08/20/2014 - 11:37 | 5120123 Perimetr
Perimetr's picture

" a "scorched earth" transaction that burns all bridges, and goodwill, with the international creditor community"

Since when does the "international creditor community" have any goodwill?

Wed, 08/20/2014 - 11:46 | 5120177 fishwharf
fishwharf's picture

I like it.  Devolver Islas Malvinas!

Wed, 08/20/2014 - 11:48 | 5120183 pain_and_soros
pain_and_soros's picture

Falklands, here we come.....or is it Folkslands?

Wed, 08/20/2014 - 11:58 | 5120216 deeply indebted
deeply indebted's picture

"...likely leaves Argentina unable to access global capital markets for the foreseeable future."

Bullshit! What?! Are you fucking blind?

Argentina is shifting towards the BRICS, and access to capital will NOT be a problem, trade will NOT be a problem, new partners will NOT be a problem, as Argentina will be rewarded handsomely for loyalty to the new regime.

 

P.S. If you haven't figured out what the significance of the BRICS and the SCO is yet, I'd suggest you look into it sooner rather than later.

Wed, 08/20/2014 - 11:59 | 5120255 joego1
joego1's picture

Another bric in the wall or brica?

Wed, 08/20/2014 - 12:44 | 5120544 Paracelsus
Paracelsus's picture

The Falklands / Malvinas conflict forced the USA to line up with the Brits,or Argentina.

The whole of Latin America was unsurprised by the result.

The issue of the New York Court is one of integrity,honesty,and morality.

The interest payment on the debt had been deposited.The judge blocked the payout,based on "parra passu".

Where was this judge when Wall Street was ass-raping the US taxpayer?

What we are seeing is a re-introduction of risk into the world markets.

Everyone should be thanking the Argentine government for their ethical stand.

They wanted to avoid a default,but balked at rewarding the Vulture funds at a thousand times return.

A shame when people could step back from the brink but do not.

No one has mentioned that the $539 million interest payment could have bought a lot of baby formula 

or other necessities for life.This reminds me how the Soviets raped Finland with massive reparations.

People should pick up a history book now and then.It was the punitive Versailles treaty at the end of

WW1 which ultimately pushed Germany over the edge (hyper-inflation).It always,always,leads to war.

We are living in interesting times.

Wed, 08/20/2014 - 20:45 | 5123055 bid the soldier...
bid the soldiers shoot's picture

Mustn't forget the "Boxer Protocol" at the turn of the 20th Century.

The Boxer Protocol was signed on September 7, 1901, between the Qing Empire of China and the Eight-Nation Alliance that had provided military forces (Austria-Hungary, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States) plus Belgium, Spain and the Netherlands after China's defeat in the intervention to put down the Boxer Rebellion at the hands of the Eight-Power Expeditionary Force. It is often regarded as one of theUnequal Treaties

450 million taels of fine silver (~ US$333 million or£67 million at the exchange rates of the time) were to be paid as indemnity over a course of 39 years to the eight nations involved.[4]

The Chinese paid the indemnity in gold on a rising scale with a 4% interest charge until the debt was amortized on December 31, 1940. After 39 years, the amount was almost 1 billion taels (precisely 982,238,150),[4] or ~1,180,000,000 troy ounces (37,000 t) @ 1.2 ozt/tael.450 million taels of fine silver (~ US$333 million or£67 million at the exchange rates of the time) were to be paid as indemnity over a course of 39 years to the eight nations involved.[4]

 

The sum was to be distributed as follows: Russia 28.97%, Germany 20.02%, France 15.75%, United Kingdom 11.25%, Japan 7.73%, United States 7.32%, Italy 7.32%, Belgium 1.89%, Austria-Hungary 0.89%, Netherlands 0.17%, and Spain, Portugal, Sweden, and Norway 0.025%? Also, additional 16,886,708 taels was paid at local level in 17 provinces. By 1938, 652.37 million taels had been paid. The interest rate (of 4% per annum) was to be paid semi-annually with the first payment being the July 1, 1902.[citation needed]


Wed, 08/20/2014 - 12:45 | 5120545 riskarb
riskarb's picture

She's negotiating. Elliott's move.

Wed, 08/20/2014 - 12:45 | 5120546 Peter K
Peter K's picture

Christina, pay your bills. You are better than that.....

Wed, 08/20/2014 - 13:04 | 5120661 nostromo17
nostromo17's picture

All else aside the local law or city or regional credits are better than the Argentina sovereign credit....by the way is sovereign an an exception to "i before e except after c and when sounded like "a" as in neighbor or weigh or is it sovereign the ei is really sounded like a?....

Wed, 08/20/2014 - 13:09 | 5120687 nostromo17
nostromo17's picture

In the big historical picture none of this is new Argentina defaults on average every fifteen years and when new york money center banks arrange bonds no country can pay back due to high coupons what would you expect? Everybody makes out anyway, Argentina gets its loans, the money center banks make money trading and selling the bonds while they aren't defaulted, the buyers get high coupons and if they get out soon enough no problem, the CDS hedges pay off on default and when the default occurs the money center banks get a tax write off. Nothing to see here, move along....

Wed, 08/20/2014 - 13:36 | 5120875 Jano
Jano's picture

Fu*k the Jew York Judge.

Bravo Argentina.

Wed, 08/20/2014 - 14:16 | 5121141 Angry Plant
Angry Plant's picture

Good for Argentina asserting sovereignty and good for the Judge not letting them default by stealth and keeping the integrity of US judical system intact.

Let the banksters eat this 30 billion loss and learn from it. Don't loan money to serial defaulters and expect it's going to somehow be different this time. 

Wed, 08/20/2014 - 14:44 | 5121316 jmc8888
jmc8888's picture

The article should mean....unable to access the West's British Empire capital markets.

But since they are joining the BRICS, for real development, instead of derivatives, and will have access to THOSE lines of credit, somehow I don't think they care what the British Empire or judge Greisa think.

 

Glass-Steagall

 

Wed, 08/20/2014 - 16:23 | 5121777 Herdee
Herdee's picture

That's OK.she's got a back door investment deal from China and Russia.The ponzi western NY and EU bankers and the corrupt IMF can go to hell.

Wed, 08/20/2014 - 18:26 | 5122421 ThroxxOfVron
ThroxxOfVron's picture

IF you like your defaulted bond that you bought for pennies on the dollar you can keep your defaulted bond that you bought for pennies on the dollar!

Wed, 08/20/2014 - 18:33 | 5122448 walküre
walküre's picture

The US can default with Hillary in office. We need to have real balls in the White House before anyone takes us serious again!

Wed, 08/20/2014 - 18:42 | 5122501 walküre
walküre's picture

Oh, please let it be that Allianz and DB are somehow involved and Germany pulls to the East to make non USD deals with Vlad.

Wed, 08/20/2014 - 19:33 | 5122735 Rootin' for Putin
Rootin' for Putin's picture

I think there must have been a phone call something like this;

Hey Vlad, its Christina.  These fucking US bankers are pissing me off.  Any ideas how i can totally screw them over?

 

 

Wed, 08/20/2014 - 19:44 | 5122794 nosoeawe
nosoeawe's picture

Lend me 10k and it's my problem

Lend me 30 billion and it's your problem

Seems like wrinkles kirchner bent over the banksters with no vaseline

 

Go kirchner!

Wed, 08/20/2014 - 20:36 | 5123013 are we there yet
are we there yet's picture

If BRICS development bank picked up future Argentine debt, it would still be a future default for them as well. A deadbeat going from one bank to another does not create new wealth.

Wed, 08/20/2014 - 21:33 | 5123284 BruntFCA
BruntFCA's picture

Oh Noes!

Can't get access to "international" capital makets.

[Translation]

Can't borrow worthless toxic dollars to export US inflation.

Wed, 08/20/2014 - 21:35 | 5123299 toros
toros's picture

Corzine would be there in a NJ minute with cash for junk Argentine bonds if he wasn't banned to the Hamptons.

Wed, 08/20/2014 - 21:45 | 5123359 Jack Burton
Jack Burton's picture

" and likely leaves Argentina unable to access global capital markets for the foreseeable future."

Well, that SHOULD have been the state of affairs two decades ago! If you lend to Argentina, you are mad!

Thu, 08/21/2014 - 00:59 | 5124044 TNTARG
TNTARG's picture

YES. 'cause Argentina DOESN'T NEED any loan.

Hope nobody lend to Argentina anymore. Gvts who demand loans in this country, and those who lend to the gvt., both are trying to steal something - or a lot - of our richness.

 

Thu, 08/21/2014 - 01:02 | 5124047 bid the soldier...
bid the soldiers shoot's picture

Even though Judge Greisa is a member of the Christian Science Church, if you walk by his chambers most any time of the day, you will hear the Judge singing:

If I were a rich man,
Ya ha deedle deedle, bubba bubba deedle deedle dum.
All day long I'd biddy biddy bum.
If I were a wealthy man.
I wouldn't have to work hard.
Ya ha deedle deedle, bubba bubba deedle deedle dum.
If I were a biddy biddy rich,
Yidle-diddle-didle-didle man.

In a recent call to his wife picked up by the NSA the judge was overheard telling her "Call the movers, Sweetpea, I'm retiring and we're moving to the Emirates Palace hotel in Abu Dhabi." 

Thu, 08/21/2014 - 06:04 | 5124236 StrikerMax
StrikerMax's picture

If there is anyone I really dislike and makes me sick is the Argentina current President, Kitchner ... she and her husband were good pals of a big Construction developer who payed her husband campaing and election ... of course he got a Lot of Government contracts afterwards to make mega constructions for the Governenmt .... Multiple Billions ... all with Zero competiton, direct contracts ...

That same Friend and Known sponsor of Kitchner's ... used the Governmental Airplane Before the crash in 2001 to take Billions in the famous Argentina "Bin Laden's" ... 500euros notes ... the biggest denomination of any currency to Santa Cruz, South of Argentina.

That guy USed the Governmental Airplane and Pilot to make several trips to his Huge house in the remote Santa Cruz and ... laugh at this: He had a problem with all his Billions bags of 500 euro notes: No Vault.

This is the good part folks seat down you guys are going to love this one :) ... he went to the Only STATE Owned Bank in Town and asked to Remove the Banks VAULT!!! Not kidding! This was on the Newspapers in Argentina, it's Public ... and the Vault was Removed from the basement of the Bank and installed in his house/Mansion !!

Amazing, Funy in a cinical way ... but all public knowledge ... and she Gets Elected !!!

Now to the subject ... in this case of the Debt I Totally Agree with Argentina Position ... they WANT to Default they should do so with their Sovereign Integrity ... not ruled in NYC ...

They should set Wathever rules they want on their default and Greece made the Wrong decision !

Folks ... Sovereign Debt HAS Risk just like everything else! Worse ... it has Even more Risk then most private/corporate Debt as we can see from Argentina.

 

 

Thu, 08/21/2014 - 07:49 | 5124373 AdvancingTime
AdvancingTime's picture

At some point the return on loaning money is simply not worth the risk!  It might soon become apparent the economic efficiency of credit is beginning to collapse and the additional money poured into the system coupled with lower rates can no longer drive the economy forward.  When this happens we are at the end game.

 Why do you want to loan money if most likely you will never be repaid or repaid with something that is totally worthless? When this happens the only safe place to store wealth will be in "tangible assets" and the only lenders will be those who print the money that nobody wants.

The collapse of credit can pose major problems such as what we saw when many sellers were forced to demand payment up front before shipping goods in 2008. More on this subject below.

http://brucewilds.blogspot.com/2014/06/the-economic-efficiency-of-credit...

Thu, 08/21/2014 - 08:39 | 5124492 GoldIsMoney
GoldIsMoney's picture

It's astonishing how many comments show a complete lack of understanding or less unfriendlich show how stupid they are. Trusting the words of bureaucrats and do-gooders. And then it's even more astonishing what lack about property rights is shown. I'm now puzzling should I be amazed of be ashamed?

The argentinian politiicians have lied over and over and over again, and still the evil are those which just want to see their credits returned.

I really do not not about that much of amazin stupidity and complete corruption. I now understand more and more why we are in that mess we're in.

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