Argentine Economy

[QUOTE=Tessan]Sept. 29 (Bloomberg) -- Argentina's defaulted bonds gained after the government said Cabinet Chief Sergio Massa will speak tonight about an offer to restructure the $20 billion of debt that creditors held out of a 2005 settlement.

The bonds rose 1 cent to about 29 cents on the dollar, according to London-based Exotix Ltd. The securities have risen 3 cents in the past six days as President Cristina Fernandez de Kirchner said on Sept. 22 that she was considering a proposal to settle with creditors who rejected the government's offer three years ago of 30 cents on the dollar.

'We're seeing a lot of trading at the moment,'' said Amir Zada, an associate director in New York at Exotix, a brokerage that specializes in distressed securities.

Fernandez is seeking to settle with the so-called holdouts -- a move that signals a change in tack -- in an effort to regain access to international capital markets as slowing growth and declining commodity exports cut into tax revenue. Lawsuits from creditors including Kenneth Dart, a billionaire investor who sued Brazil during that country's 1994 restructuring, have prevented the government from issuing debt abroad.

Argentina is considering a restructuring offer that would require creditors to invest $25 in new bonds for every $100 of defaulted debt they swap, helping the South American country raise cash to meet its financing needs, according to a government official.

Payout Estimates.

Citigroup Inc. Barclays Plc and Deutsche Bank AG proposed the restructuring plan, according to the official, who asked not to be identified because he isn't authorized to speak for the administration. Peter Truell, a spokesman with Barclays, Ted Meyer, a spokesman with Deutsche Bank, and Danielle Romero- Apsilos, a spokeswoman with Citigroup, declined to comment. All three are based in New York.

[url]http://www.bloomberg.com/apps/news?pid=20601086&sid=akHEnBtKlUoY&refer=latin_america[/url][/QUOTE]Not sure about how serious this is going to be for Argentina, but sure as hell we all ought to be worried about escalating US national debt if the following analysis is anywhere near the mark.

[url]http://www.tickerforum.org/cgi-ticker/akcs-www?post=64606[/url]

[QUOTE=Lysander]Not sure about how serious this is going to be for Argentina, but sure as hell we all ought to be worried about escalating US national debt if the following analysis is anywhere near the mark.

[url]http://www.tickerforum.org/cgi-ticker/akcs-www?post=64606[/url][/QUOTE]This is vary serrious shit Lysander, The CockSuckers are selling us a "Pig in a Polk", We're all broke and don't know it.

Exon

Argentina May Set Restructuring Details Next Week, Clarin Says.

By Drew Benson.

Oct. 2 (Bloomberg) -- Argentina may release details of its debt restructuring offer on Oct. 6, newspaper Clarin reported, without saying how it obtained the information.

Finance Secretary Hernan Lorenzino flew to New York last night to work with lawyers and bankers on the offer to restructure $20 billion of bonds that were held out of a 2005 settlement, Clarin said.

To contact the reporter on this story: Drew Benson in Buenos Aires at [email]abenson9@bloomberg. Net[/email]

[QUOTE=Lysander]Not sure about how serious this is going to be for Argentina, but sure as hell we all ought to be worried about escalating US national debt if the following analysis is anywhere near the mark.

[url]http://www.tickerforum.org/cgi-ticker/akcs-www?post=64606[/url][/QUOTE]Article like this, are assuming that the 700 billion dollars is gone, give away never to be seen again. The reality is the government will be buying mortgages, most of which are not in default. The question is how much the government pays for it. The stuff is trading pennies on the dollar right now. If the government pays market prices, it will probably make money, since it can hold this stuff to maturity, while the banks don't want to, since it would tie up there money for new loan.

Their is a provision in the law that tells the treasury to take extraordinary steps to avoid foreclosures. Which mean, they might reduce the amount owed, and absorb the lose, while a bank would have foreclosed. If they pay 35 cents on the dollar, it does not matter, if they take 50% off the mortgage, since they only paid 35 cents. If they pay 75 cents, like I've heard some people want, then they would lose money.

Paulson said they might do reverse auctions, to set a price. The Auction will be narrow, with similar mortgages, since depending when and where the mortgage was written, its value can differ quite allot. He also said, they might start off with the stuff that is not selling, probably the worst stuff written at the height of the bubble.

It all depends at what price the Treasury pays for this stuff. They have to pay enough to re-capitalize the banks, so they can lend again, but not too much, or they'll be seen as rewarding greed. The more they pay, the more likely they will lose money.

The US, is in recession, and likely to be in one for a year or 2. Without helping out the banks, it would have been far worse. But it's not going to be good. The deficit will go up, as it usually does, during recessions, as people pay fewer taxes, and unemployment goes up.

[QUOTE=Tessan]Article like this, are assuming that the 700 billion dollars is gone, give away never to be seen again. The reality is the government will be buying mortgages, most of which are not in default. The question is how much the government pays for it. The stuff is trading pennies on the dollar right now. If the government pays market prices, it will probably make money, since it can hold this stuff to maturity, while the banks don't want to, since it would tie up there money for new loan.

Their is a provision in the law that tells the treasury to take extraordinary steps to avoid foreclosures. Which mean, they might reduce the amount owed, and absorb the lose, while a bank would have foreclosed. If they pay 35 cents on the dollar, it does not matter, if they take 50% off the mortgage, since they only paid 35 cents. If they pay 75 cents, like I've heard some people want, then they would lose money.

Paulson said they might do reverse auctions, to set a price. The Auction will be narrow, with similar mortgages, since depending when and where the mortgage was written, its value can differ quite allot. He also said, they might start off with the stuff that is not selling, probably the worst stuff written at the height of the bubble.

It all depends at what price the Treasury pays for this stuff. They have to pay enough to re-capitalize the banks, so they can lend again, but not too much, or they'll be seen as rewarding greed. The more they pay, the more likely they will lose money.

The US, is in recession, and likely to be in one for a year or 2. Without helping out the banks, it would have been far worse. But it's not going to be good. The deficit will go up, as it usually does, during recessions, as people pay fewer taxes, and unemployment goes up.[/QUOTE]Tessan,

You didn't take the time to read this.

[url]http://www.tickerforum.org/cgi-ticker/akcs-www?post=64606[/url]

Nor did you follow the link there to this

[url]http://www.fedupusa.org/[/url]

The real bottom line is the world is pissed off at us and is threating not to buy anymore of our debt if we don't make good on this scam's we sold them.

The majority of the 700 billion bail out is to be spent to buy foreign investor's worthless mortgage back securities. And Bush has told Congress that if this provision is taken out of the bill he'll veto the bill.

The basic bottom line is we the tax payers are being lied too. And the world's central banks are black mailing our government into "either buy back this worthless debt or we won't buy your debt". If they don't buy our debt we're broke since the the sales of treasuary bill's is central to finnancing our defecit spending.

This is a very, very serrious matter and most American people don't know about it.

Exon

I called my congresswoman this morning not to say NO, but "Hell NO.

The girl answering the phone told me she been at work half an hour and fielded 12 phone call's.

9 No's and 3 Yes's.

Exon

[QUOTE=Exon123]Tessan,

You didn't take the time to read this.

[url]http://www.tickerforum.org/cgi-ticker/akcs-www?post=64606[/url]

Nor did you follow the link there to this

[url]http://www.fedupusa.org/[/url]

The real bottom line is the world is pissed off at us and is threating not to buy anymore of our debt if we don't make good on this scam's we sold them.

The majority of the 700 billion bail out is to be spent to buy foreign investor's worthless mortgage back securities. And Bush has told Congress that if this provision is taken out of the bill he'll veto the bill.

The basic bottom line is we the tax payers are being lied too. And the world's central banks are black mailing our government into "either buy back this worthless debt or we won't buy your debt".

If they don't buy our debt we're broke since the the sales of treasuary bill's is central to finnancing our defecit spending.

This is a very, very serrious matter and most American people don't know about it.

Exon[/QUOTE]I did not read the Bloomberg article.

I agree with the article that if people think the central banks will sell their treasuries, then that would cause panic selling, which would be very bad. An announcement by China and Japan, that they will not sell, would assure the market.

“Yu said China is helping the U.S. ``in a very big way'' and added that it should get something in return. The U.S. should avoid labeling it an unfair trader and a currency manipulator and not politicize other issues, he said.“

Don’t think the US should label China “Unfair trader” china would want to retaliate. But china would harm themselves as much as the US, if they start selling treasures, their currency would shoot up in value, causing there export to he harmed, and the dollar would weaken.

Treasury statistics indicate that, at the end of 2006, foreigners held 44% of federal debt held by the public. About 66% of that 44% was held by the central banks of other countries, in particular the central banks of Japan and China. [url]http://en.wikipedia.org/wiki/United_States_public_debt[/url] So Foreign central banks hold 29.04% of the united state dept. This is about 2.61 Trillion dollars.

The United States GDP was estimated to be 13.8 Trillion in 2007. M3, which is no longer published, is estimated to be 11.5 Trillion. [url]http://www.nowandfutures.com/key_stats.html[/url]

Treasuries interest rates are below the level set by the fed, and the fed has run out of Treasuries to sell in the market. It lent or sold all the treasures it had, and interest rates are below the target. That mean Treasuries are in great demand. The Fed even sold treasuries it did not have, in a way shorting them, and interest rates are still very low. Their is allot of demand right now. The fed can keep shorting treasuries, until interest rate get back to its target rate, but it probably likes the rate lower, to help inflate the economy that is in recession, without having to officially lower rate, which people say is inflationary.

If people where selling treasuries, interest rate should be going up, and the fed instead of selling out it's treasuries, would be buying them, to help lower interest rates, so it looks like the opposite is happening right now.

I also did not see that video. My understanding is that the Treasury will hold a reverse auction. That only Banks that are regulated in the united state, including subsidiaries of foreign banks, can participate. Their was a big stink when some republican tried to block the subsidery from participating. These banks said, they did buiness within the united states, and should be treated the same as other banks. The fact that they have a foreign parent does not matter. Paulson said the more banks that offer mortgages, the cheaper the price the government will buy them in the auction, and that these subsidiaries perform the same function within the United States, and other banks do.

Also their was talk, that if the United States treats subsidiary differently, then their own banks, then other countries might start treating US subsidiary differently then there own banks as well.

Paulson said he wanted the ability to buy from non banks, but there was no intention to so, unless something unexpected came up.

Somehow I don't think that adding the 0.7 Trillion dollar, to buy mortgages, will somehow cause all these central banks to start selling dollars. It's not in there interest. They might buy less treasuries in the future, which will make it harder for the fed too keep interest rate low, but I really don't think they will dump treasuries quickly, it would harm them as much as the U. S. It's even possible the U.S. government will make money on the mortgages, depending on what they pay for them.

[url]http://www.bloomberg.com/apps/news?pid=20601086&sid=a.oA0427RjZ4&refer=latin_america[/url]

Argentine Central Bank Lifts Rates on Repo Agreements (Update1)

By Bill Faries and Drew Benson.

Oct. 6 (Bloomberg) -- Argentina's central bank raised interest rates on its repurchase agreements in an effort to boost the attractiveness of peso deposits as the global financial crisis prompts investors to shun emerging markets.

The bank said in an e-mailed statement that it raised the rate on repurchase agreements of 1 to 60 days by 75 basis points, or 0.75 percentage point. The rate on one-day repos rose to 12.5 percent. For 60-day repos, the rate is now 14.75 percent.

'The central bank needs to maintain some sort of stability in the money markets under huge capital flight, like the one Argentina is suffering right now,'' said Alberto Bernal, head of emerging-market research at Bulltick Capital Markets in Miami.

South America's second-largest economy is faltering as investors pull money out of higher-yielding, emerging market assets and the global financial crisis deepens. The country's benchmark Merval index declined 9.8 percent at 1:11 p. M. New York time. The spread on Argentine bonds over U. S. Treasuries widened 122 basis points, or 1.22 percent, the most in emerging markets.

'They are trying to make the banks more attractive and help the monetary base,'' said Nicolas Todesca, an economist at Delphos Investments in Buenos Aires.

In repos, the central bank buys securities from Argentine banks, temporarily raising the amount of money available in the banking system. At maturity, the securities are returned, and the cash is returned to the central bank.

The central bank last raised rates on repos, also by 75 basis points, on May 12 amid a four-month farm strike that prompted savers to withdraw deposits from Argentine banks in order to buy dollars.

Argentina's peso fell 1.1 percent to 3.1975 pesos per dollar, its weakest level since July 2007.

To contact the reporters on this story: Bill Faries in Buenos Aires at [email]wfaries@bloomberg. Net[/email]; Drew Benson in Buenos Aires at [email]abenson9@bloomberg. Net[/email]

Last Updated: October 6, 2008 13:45 EDT