Argentine Economy

[Dickhead]

Argentina will pay because it is anxious to re-establish foreign credit, it has many attractive projects needing funding (ie Vaca Muerte) though it probably won't go back to Wall Street.

I'm sorry; I have to go. It's time for my pig's flying lesson.

[Canardly]

'the big unanswered question is whether or not Argentina will actually pay when the bonds mature".

Argentina will pay because it is anxious to re-establish foreign credit, it has many attractive projects needing funding (ie Vaca Muerte) though it probably won't go back to Wall Street.

http://www.buenosairesherald.com/article/169492/argentina-will-return-to-foreign-markets

[Jackson]

And particularly if the institutional holders start a likely selling stampede when they focus on their legal status according to their internal governing regulations.

Many institutional holders are by their own rules prohibited from holding bonds in default status, and thus at some point they will be compelled to sell off any Argentina "exchange bonds" in their portfolios, resulting in a swift devaluation in said bonds.

I predict that at that time the "vultures" will pickup up more of these distressed "exchange bonds", again at so called "bargain" prices.

Thanks,

Jax.

BTW, if Elliott Management, NML Capital, etc. Are "the vultures", then doesn't that make Argentina "the carcass"?

J.

[Tres3]

Yield to maturity about 15% at current prices -.

The yield to maturity is indeed enticing, but the big unanswered question is whether or not Argentina will actually pay when the bonds mature. For me, non-payment is not worth the risk.

Tres3.

[Canardly]

The vast majority of institutional holders of these bonds will be uncomfortable receiving interest and principal in Buenos Aires.

To me it's very interesting how well the prices have held up. The "BODENS" 7% due in October 2015 are quoted at 95.

For investors who would like to receive "Argentina Legal" US dollars in BsAs it's an interesting opportunity. Yield to maturity about 15% at current prices -.

And particularly if the institutional holders start a likely selling stampede when they focus on their legal status according to their internal governing regulations.

[Jackson]

From the Buenos Aires Herald online-.

"Ruling Victory Front lawmakers passed the Sovereign Payment bill -establishing the local payment agent for creditors, a new voluntary debt swap, and the creation of a permanent bicameral debt oversight committee- in the Lower House of Congress with barely no support from opposition blocs. ".

http://www.buenosairesherald.com/art...-vulture-funds

The "BODEN" bonds 7% due October 3rd 2015 trade around 95.

I predict that an overwhelming majority of Exchange Bondholders will decide that their temporarily non-performing USA adjudicated bonds are preferable to any class of Argentina adjudicated bonds, period.

This is all just a political ruse to mollify the great unwashed masses.

Kicillof has repeatedly insisted that there are tens of thousands of exchange bondholders who have expressed interest in exchanging their USA adjudicated bonds for Argentina bonds, but in fact the media has been unable to find more that a small handfull of actual volunteers.

Jax.

[Canardly]

From the Buenos Aires Herald online-.

"Ruling Victory Front lawmakers passed the Sovereign Payment bill -establishing the local payment agent for creditors, a new voluntary debt swap, and the creation of a permanent bicameral debt oversight committee- in the Lower House of Congress with barely no support from opposition blocs. ".

http://www.buenosairesherald.com/art...-vulture-funds

The "BODEN" bonds 7% due October 3rd 2015 trade around 95.

[Gandolf50]

Isn't that oil refined in the US because the US refineries can process the heavy crude? I would imagine a lot of that oil is sent back to Venezuela and sold for 2 cents / litre.

They send crude to the US because they did not or could not maintain their own refinery's. They either fell apart, burnt or just degraded to the point they could no longer be used. They still have a few running but no where near enough to handle the output. Because their crude is heavy and low quality not every one can refine it for them. Their out put is way down also for the same reasons, neglect.

[Riina]

Isn't that oil refined in the US because the US refineries can process the heavy crude? I would imagine a lot of that oil is sent back to Venezuela and sold for 2 cents / litre.

I believe the oil is processed at a cost of about $2. 50 a gallon before it's sent back to Venezuela and sold for pennies a gallon. US holders of Venezuela debt could easily lien something in that process.

[Retire N Trave]

Per Bloomberg Venezuela oil exports to US are very weakening greatly.

http://www.bloomberg.com/news/2014-0...ince-1985.html a.

http://www.bloomberg.com/news/2014-0...es-credit.html

Information and views on Venezuela oil export problems - http://www.panamericanworld.com/en/a...el-three-years.

http://www.miamiherald.com/2014/09/0...amas-plan.html

http://www.miamiherald.com/2014/08/3...uela-from.html

Meanwhile, the USA has recently passed Saudi Arabia as the largest oil producer in the world.

[Dccpa]

I don't see how they could default with all the oil they send to the US for refinement. Griesa set the precedent.

Isn't that oil refined in the US because the US refineries can process the heavy crude? I would imagine a lot of that oil is sent back to Venezuela and sold for 2 cents / litre.

[Riina]

Situation in Venezuela looks unsustainable per Bloomberg http://www.bloomberg.com/news/2014-0...ond-desks.html and http://www.bloomberg.com/news/2014-0...in-august.html. Meanwhile, oil prices continue to fall and the US dollar is getting stronger making it even tougher on Venezuela. Anyhow, if Venezuela does default the news will probably be treated as "wave of defaults hits South America" due to Argentina's current default.

I don't see how they could default with all the oil they send to the US for refinement. Griesa set the precedent.

[Retire N Trave]

Situation in Venezuela looks unsustainable per Bloomberg http://www.bloomberg.com/news/2014-0...ond-desks.html and http://www.bloomberg.com/news/2014-0...in-august.html. Meanwhile, oil prices continue to fall and the US dollar is getting stronger making it even tougher on Venezuela. Anyhow, if Venezuela does default the news will probably be treated as "wave of defaults hits South America" due to Argentina's current default.

[Thomaso276]

Read today that K & K are keeping inflation vs the alternative of a crash. Does this make sense? Any economists out there? Dickhead?

[Gandolf50]

More obfuscation from CFK's government.

http://www.bloomberg.com/news/2014-0...tml?cmpid=yhoo

Tres3.

She is accustomed to lying to her uneducated, unwashed masses here in Argentina. Most of them believe her, so she thinks every one else will. Its all smoke and mirrors and a awfully lot of unadulterated BULLSHIT! She tells you want SHE wants you to believe, not what is true or what is actually happening.