Argentine Economy

There are good, positive purposes of Wall Street. But there are some Wall Street activities that are bad, and some that are sleazy.

No one is questioning the legality of the actions of Paul Singer and the vulture funds. But just because it's legal doesn't make it right. And that's where many people have an issue with the vulture funds, not just in Argentina. They buy distressed debt, and instead of working with the debtor, they work against the debtor to extract as much profit as possible. In Singer's case, Argentina could yield a 1600% profit. Even better than the profits he made off Peru and the Congo, from whom he forced payments with similar tactics. Even though the debtors could pay him, they are worse off because of his actions.

So what category do the vulture funds fall under: Good, Bad or Sleazy? Here's what another hedge fund manager, Kyle Bass, has to say about Paul Singer:

[QUOTE]The bottom line is, he's a tremendous distressed investor. And he's a profiteer at other peoples expense.[/QUOTE][URL]http://www.businessweek.com/articles/2014-08-07/argentinas-vulture-paul-singer-is-wall-street-freedom-fighter[/URL]

[QUOTE=Esten;441003]Exactly, and you can thank Paul Singer and US vulture funds for helping drive Argentina in this direction. There are geopolitical consequences to Wall Street greed.[/QUOTE]Was Singer around when Argentina backed Nazi Germany? This has always been bizzaro land. I am not a fan of hedge funds, but Argentina cannot be trusted.

There are many sides to this argument. There are hold outs and then there are opportunists Like Singer. We all know how Singer works. Then there are the 90 year old retires who invested 45 k in these bonds hoping for a return so they can continue to live comfortably once (IF) they collect. They are HOLDING OUT for the return of their hard earned money. One was profiled in Clarin the other day. These are people who really need their money. My point being is that not all of the "holdouts" are "Vultures" or opportunists. Many are normal people who just want their money without a huge "Haircut" . Maybe the courts should differentiate between the two? The bottom line is that Argentina DOES NOT WANT TO PAY!! They are really no better then a group of white collar thieves. As I pointed out earlier, Cristina and Nestor made their money the same way that Singer does. If any one has really been following this disaster, this government is not only giving people a haircut, but then want to pay in deferred payments that they WILL PROBABLY NEVER FINISH BEING BE PAID! . They are now only making interest payments. Principal payments start in 2016 AFTER THIS GROUP OF THIEVES IS GONE! That and the fact is that this group has only started trying to put its house in order is so that they CAN BORROW MORE MONEY! If they can't make these payments. How can they afford to pay more payments? This government does not really invest in the future of the country. They use money to put out fires and to pay subsidies to the poor so they can get re elected. Typical third world tin horn dictator bullsh*t.

Does anyone know if Singer's interest in this is purely personal, or is he perhaps fighting on behalf of investors in his hedge fund? Was the Clarin article about people who hold the bonds directly or about people who have investments in the Singer hedge fund? Usually hedge funds have investors, right? Some of whom might be fat cats but some of whom might not be.

Bob.

[QUOTE=Esten;441005] <snip>
No one is questioning the legality of the actions of Paul Singer and the vulture funds. But just because it's legal doesn't make it right. <snip>[/QUOTE]Good point Esten. I agree. But how do we make business decisions on what's right rather than what's legal? Who would make those decisions? And how? Based on their own moral code? Or maybe they would take a poll for each case?

And how would people make any kind of agreement with any level of confidence that it was consistent with the moral code that would be applied should some third party need to arbitrate a disagreement?

I guess we could write down a moral code, but isn't that exactly what our legal code is supposed to be?

Bob.

[QUOTE=AllIWantIsLove;441011]Does anyone know if Singer's interest in this is purely personal, or is he perhaps fighting on behalf of investors in his hedge fund? Was the Clarin article about people who hold the bonds directly or about people who have investments in the Singer hedge fund? Usually hedge funds have investors, right? Some of whom might be fat cats but some of whom might not be.

Bob.[/QUOTE]He has investors as well as his own money involved. As far as the Argentine bonds are concerned who knows what the percentages are. Cristina makes it look like it is just him. They tend to over look that there are other hold outs. Many of them Argentinos.

[QUOTE=Esten;441005]There are good, positive purposes of Wall Street. But there are some Wall Street activities that are bad, and some that are sleazy.

No one is questioning the legality of the actions of Paul Singer and the vulture funds. But just because it's legal doesn't make it right. And that's where many people have an issue with the vulture funds, not just in Argentina. They buy distressed debt, and instead of working with the debtor, they work against the debtor to extract as much profit as possible. In Singer's case, Argentina could yield a 1600% profit. Even better than the profits he made off Peru and the Congo, from whom he forced payments with similar tactics. Even though the debtors could pay him, they are worse off because of his actions.

So what category do the vulture funds fall under: Good, Bad or Sleazy? Here's what another hedge fund manager, Kyle Bass, has to say about Paul Singer:

[URL]http://www.businessweek.com/articles/2014-08-07/argentinas-vulture-paul-singer-is-wall-street-freedom-fighter[/URL][/QUOTE]Argentina is worse off because of Argentina's actions. Argentina could have easily paid Singer a long time ago and been done with this issue without any damage to their credit. But no, they had to throw a hissy fit, blame everyone else and refuse to negotiate in good faith. Argentina and Argentina alone is responsible for the default.

I regard Kyle Bass as one of the top money managers in the world, but Argentina's US attorney was Kyle Bass's attorney and he released him to work with Argentina. Why would Bass do that? Bass's fund has made a significant investment in Argentinian bonds. Bass also went on record that Argentina would win in court. He was wrong. Kyle Bass is just a little prejudiced in this situation.

[QUOTE=AllIWantIsLove;441012]Good point Esten. I agree. But how do we make business decisions on what's right rather than what's legal? Who would make those decisions? And how? Based on their own moral code? Or maybe they would take a poll for each case?

And how would people make any kind of agreement with any level of confidence that it was consistent with the moral code that would be applied should some third party need to arbitrate a disagreement?

I guess we could write down a moral code, but isn't that exactly what our legal code is supposed to be?

Bob.[/QUOTE]What is right or moral about Argentina reneging on a debt when they have the assets to pay the debt? Argentina isn't someone who went bankrupt because of an unexpected medical expense. They spent money like drunken sailors, didn't pay their bar tab even though they had money in their pockets and now they whine to the world about being forced to pay a small percentage of the tab. Argentina is a serial defaulter and deserves no one's pity or help. Argentina should get their act together or else continue to suffer the consequences of their reckless spending. Anyone loaning money to Argentina right now should have their partner wear an I'm with stupid t shirt.

Apparently Cristina and her cohorts want to practice a scorched earth policy.

[URL]http://www.bloomberg.com/news/2014-08-26/argentina-revoked-bny-mellon-s-banking-license-capitanich-says.html?cmpid=yhoo[/URL]

Tres3.

More on Argentina debt default.

[URL]http://www.bloomberg.com/news/2014-08-26/soros-s-bond-bet-revealed-in-lawsuit-in-london-argentina-credit.html[/URL]

Tres3.

[QUOTE=Tres3;441029]Apparently Cristina and her cohorts want to practice a scorched earth policy.

[URL]http://www.bloomberg.com/news/2014-08-26/argentina-revoked-bny-mellon-s-banking-license-capitanich-says.html?cmpid=yhoo[/URL]

Tres3.[/QUOTE]Revoking the authorization for two officials. Man these geopolitical repercussions Esten warned us about are really something. It will take BNY Mellon all of five minutes to authorize two other officials to act in their capacity in Argentina.

Anyone notice in the second article that Hayman Capital (Kyle Bass) are mentioned as suing to get interest income payments on the bonds?

The interesting fact that the media does not report, and the Argentine government conveniently overlooks, is that Bank Mellon NY has received NO instructions from Argentina, to wire transfer the money in compliance with the federal district judge's order. The only instructions that BMNY has received is to pay the bond interest to the "haircut" bondholders, but not the "hold out" creditors. The judge has ordered BMNY that if they pay one, they must pay all, or be held in contempt. Contrary to the Argentine government, BMNY will not break the law, and cannot legally return the money to Argentina, because Argentina refuses to give them wire transfer instructions. BMNY finds itself between a rock and a hard place. Something tells me that once this debacle is all over, BMNY will not do any more business with the Argentine government.

Tres3.

[URL]http://finance.yahoo.com/news/argentina-says-us-based-bny-164656114.html[/URL]

Argentina is revoking BNY Mellon's authorization to operate in Argentina. Oh wait,

"BNY Mellon has no retail operations in Argentina".

Tres, I doubt Mellon wants to do any business with Argentina.

[QUOTE=Dccpa;441038][URL]http://finance.yahoo.com/news/argentina-says-us-based-bny-164656114.html[/URL]

Argentina is revoking BNY Mellon's authorization to operate in Argentina. Oh wait,

"BNY Mellon has no retail operations in Argentina".

Tres, I doubt Mellon wants to do any business with Argentina.[/QUOTE]LOL! I doubt any one in New York or even any one in the USA Wants anything more to do with Argentina! Except for a few of us of course. .

[QUOTE=AllIWantIsLove;441012]Good point Esten. I agree. But how do we make business decisions on what's right rather than what's legal? Who would make those decisions? And how? Based on their own moral code? Or maybe they would take a poll for each case?

And how would people make any kind of agreement with any level of confidence that it was consistent with the moral code that would be applied should some third party need to arbitrate a disagreement?

I guess we could write down a moral code, but isn't that exactly what our legal code is supposed to be?[/QUOTE]Well we all make our own decisions in life, don't we. I imagine a criteria of right action is some combination of motive and effect. Our legal code is the law, but it is imperfect and incomplete, and should not be the sole basis of our actions.