Argentina "Successfully" Rolls Debt - Sells 5-Year Note At Massive 20% Yield

So there's success and there's 'success' and while Argentine officials are proclaiming victory in managing to roll its best, saying it "couldn't have got a bigger vote of confidence," the fact that it could only sell the new bonds at 20% yields is perhaps the more important fact...

The BCRA desperately supported the peso today ahead of the auctions...

And still they could only fill their order book by paying an economy-crushing 19% (8Y) and 20% (5Y) BOTEs...

Finance Minister Luis Caputo tells reporters in Buenos Aires:

  • Govt sold about 36.9b pesos of 2023 BOTEs at 20%
  • Govt sold about 36.4b pesos of 2026 BOTEs at 19%

Caputo added that the Lebac auction was held without any issues, confidently noting that "Argentina sold this debt on the most difficult day for EM in 2018," adding that "Argentina couldn’t have gotten a bigger shot of confidence in its economy today."

Additionally, Bloomberg reports that the BCRA press office confirms that it covered more than 100% of the expiring Lebacs - with bods for 621 billion pesos at a 1-month yield of 40%!

For now, the peso market is shut but MSCI Argentina ETF is up around 3% after hours...

Caputo then reiterated that Argentina may not need to sell debt abroad in 2019 because of the financing that the nation is seeking with the IMF, and reiterated it won’t sell international debt this year. Caputo concluded optimistically saying that "volatility is to ease now in Argentina."


east of eden Ahmeexnal Tue, 05/15/2018 - 17:19 Permalink

It will still be 3 to 5 years before the Chinese/Russian payment, clearing and gold reconcilliation system is up to full speed. Until then I guess we are all just going to have to take our lumps.

But, then, when we are finally free of this stifling servitude, watch out.

In reply to by Ahmeexnal

east of eden Tue, 05/15/2018 - 17:16 Permalink

And so, ten years down the road, when they can no longer 'service' this ugly debt, Americans will once again be on the boards telling us all how 'incompetent' and 'corrupt' Argentina is.

Except that the rot and corruption is thousands of miles away, in Washington DC and NYC.

Paul Singer must be a very happy man today. He has managed to destroy what was left of Argentina, thanks to the US printing press, and total control of the MSM.


east of eden Tue, 05/15/2018 - 17:32 Permalink

You have been driven out of just about every jurisdiction that you had invaded/claimed for you own.

Now, you can't even control the countries in your own back yard. Monroe Doctrine my arsehole.

Waiting for the day when 100,000 Mexican drug cartel members cross the border and start paying you back.

buzzsaw99 Tue, 05/15/2018 - 18:01 Permalink

i smell goldman sachs.  i foresee a great imf bailout somewhere down the line where goldman sachs gets that 20% (plus fees and expenses) whether argentina pays or not.

RopeADope Tue, 05/15/2018 - 19:06 Permalink

Good thing Argentina reloaded the coffers of the vulture funds. Now they can attack Argentina again and use Argentina's own money to loot Argentina again.


Mauricio Macri is such a genius...

foreignlander Tue, 05/15/2018 - 19:27 Permalink

When the "Cambiemos" coalition won the election, they must've as well put up a sign in the prez palace: "Managed by its Owners".

And the owners are well taken care of.  What's new?  Another looting operation and surrender to the money changers.

Greece is in Argentina's future but not necessarily as a model of democracy.  

Fuck Macri and his cronies and the morons that still support him.  Not many by now I suspect.  

squid Tue, 05/15/2018 - 19:33 Permalink

Ok, call me dumb but......

why not just spend only what you take in with taxes, then you don't need to sell bonds?


Just thought i'd throw that one out there as a meme of sorts.