New York court agrees to hear bank that supports Argentina in debt restructure case
A New York federal appeals court has agreed to hear from more parties potentially affected by its review of a decision requiring Argentina to pay 1.33 billion dollars to bondholders who did not participate in two debt restructurings.
The 2nd US Circuit Court of Appeals, in an order on Monday, set aside additional time for oral arguments scheduled for February 27.
Still, lawyers on all sides will not have much time to make their case: the New York court has allotted 49 minutes overall for the arguments, up from the 30 minutes originally scheduled.
Argentina is seeking the reversal of a November order by US District Judge Thomas Griesa in Manhattan that required Argentina to pay 1.33 billion into escrow for so-called “holdout” investors when it paid bondholders who participated in the debt restructurings.
Griesa’s ruling followed an October decision by the 2nd Circuit that required Argentina to pay all of its bondholders equally, instead of giving priority to holders of restructured debt.
In Monday’s order, the court allotted time to a lawyer for bondholders who participated in the debt exchanges following Argentina’s 100bn dollars sovereign default in 2001, and to a lawyer for Bank of New York Mellon Corp, the trustee for bondholders who participated in the 2005 and 2010 exchanges. Both have supported Argentina in its appeal.
The US federal government has also indicated its support for Argentina in the controversy fearing the consequences for future debt negotiations when the world is going through a several-years financial crisis yet to be overcome.
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“Attempts to muzzle media” “attacks on judiciary ” “price freezes” “currency manipulation ” “currency restrictions” all to get a popular reaction at the cost of long term stability .
Great nations are not built like this,and Argentina could be a great nation!
I notice they are bragging that they've halted the decline in production today: www.buenosairesherald.com/article/124108/weve-halted-the-decline-in-oil-production-
.....but that could just mean they've hit rock bottom.
This woman is really some piece of work. talk about political xenaphobia.
Why should Argentina not be permitted to default on its debt?
Argentina is not the first nor will be the last country to default. You only need to look at the fringes of Europe for other current examples.
Investors holding debt in the defaulting country can agree to the restructuring of the debt or play the high risk game of holding out.
It is unfortunate, but sometimes investments go wrong. Argentina is not in the wrong here.
Idlehands,
I agree the Repsol case is basically theft.
The difference being that in the other cases the defaulting country negotiates in good faith with the owners of the debt to find a mutally acceptable hair cut for the debt and it is restructured that way. Argentina didn't do this, they just gave an ultimatum
On Repsol, CFK has already stated that due to the extreme environmental damage they have caused they are not owed anything. Very convenient although not legal. Argentina will lose at ICSID whether they show up or not for their defense.
UK voting against Arg at IDB is not good, it means they've lost support of all of the major lenders. I don't think there will be many more disbursements forthcoming. They've already delayed new WB loans and disbursement delays will follow shortly. CFK built this inflow of U$ into the 2013 budget. I don't think there is any way for her to make up that much U$ loss.
It should be fun to watch.
However, the goal to keep always in mind is to stop the Great Recession from morphing into a Great Depression.
I think the USA will continue to grind away at them bit by bit, day by day until they come into compliance abd live by the same rules every other nation has to abide by.
They're at the end of the rope and they were given just enough to hang themselves with it.
BTW I am in DC quite often I wonder if we run in the same circles?
I suspect the main reason behind “good faith” in Greek restructuring comes from the political pressure to hold the union together otherwise Greece would have said “Ante gamisou” as many of it citizens would have liked.
@11 Orbit:
“Letting sovereign nations off the hook”
They haven't been let off the hook, they can't borrow at anything like a reasonable rate. It is the same when a person is bankrupt, they can't borrow for years afterwards, but their creditors can no longer pursue them for what they defaulted on. Debtors prisons no longer exist in most civilized nations.
Those who lent $100 billion were possibly as rash as those who borrowed $100 billion.
But i'm not just talking about Greek, this is standard fopr all restructurings. It's actually very simialr to personal bankrupcy, you tend to set up payment terms with your creditors and go from there. Argetina's problems stem from the fact that they though that these issues would just go away and that those debts would have been written off. Then jumping around telling everyone how much money you have and that you are loaded just doesn't go down well...
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Join the debate on www.facebook.com/Britain1592
Falkland Islands Desire the Right!
There is no internationally agreed format for restructuring debt. At one time the norm involved an invasion and looting to recover unpaid debts.
Argentina made an offer which most of their creditors accepted. And that should be the end of the story. Those who chose to hold out stand to get nothing and that was their decision. And those who purchased worthless debt after the default deserve to get nothing.
As someone who has restructured sovereign debt I can tell you that there is a market accepted format which is standard and which follows what I laid out about. If you don't follow this format then you end up in a similar position to Argentina. Referencing what used to happen doesn't really help does it...and it doesn't back up any position. We are not talking about an anachronistic idea of debt restructuring but the current one.
Also, please do ask me to point you to a set of rules for restructuring of sovereign debt as no, they don't exist. However, if trying to negotiate away from these positions you will find it hard or nearly impossible. This is why Argentina gave a once only offer andf it is why they are having this hold-out issue at present.
They've almost exhausted the remaining court venues. I highly doubt SCOTUS will take the case of a known scofflaw.
We should know how it comes out shortly.
@7 Don't be daft. Argieland is ALWAYS in the wrong. It hasn't done one thing correctly since 1811. It couldn't even “celebrate” its “bicentennial” honestly. Its real bicentennial doesn't take place until 2016!
@12 Yup. All we want is argieland's Great Implosion. Then we can reasonably walk in, take anything we want and sell it. Just to recover all the money argieland owes. $1.33 billion is just the start!
@17 You're wrong. Argieland didn't “make an offer”. It issued an ultimatum. Because it's basically crooked. I doubt it EVER intended to repay what it borrowed. So it's a THIEF. Any civilised country would at least try to repay its debts.
We are agreed then that there is no internationally agreed format for restructuring debt. Argentina restructured and most creditors accepted the haircut. The recovery rate of 33% is worse than most modern defaults, but not as bad as some.
The Greek recovery rate is 20% but might get even lower if further restructuring is required.
The Russian default in 1998 had an 18% recovery rate - but who is going to push the matter with a nuclear armed superpower.
Argentina went bankrupt as happens periodically around the world. Lots of investors lose. The only certainty to restructuring is that the defaulting country will push for as good a deal as it can get. That is not wrong, it is just natural.
A default is traumatic for any country - the devaluation and loss of access to credit are punishment enough.
That Britain will attempt to block taxpayer’s cash being used to bail out Argentina,
International development secretary Justine greening said we’ll vote against any argie bid for more loans from the world bank and inter-American development bank,
The British government gives money to both bodies- but no longer has the confidence in Argentina’s finance data,
The British taxpayers alliance called it brilliant news,
Argentina was not so happy.
[ the sun newspaper]
Er no they aren't
You either play by the rules or suffer the consequences. The holdouts have not forgiven the original balance, all the worldwide courts have ruled in their favor and in the end Argentina will have to negotiate with them and end the suits once and for all or risk becoming Zimbabwe.
I think CFK is dumb, really really dumb and arrogant to boot.
I hope Argentina loses and loses big, enough to drive it into another default.
Maybe this will teach the stupid Rgs who keep electing thugs and scofflaws to rule them into electing someone honorable.
I don't think it will happen
but that is their choice.
My point is, there aren't any rules. Every restructuring is different. As I say above, the Greeks and Russians gave bigger haircuts than the Argies.
The holdouts chose to play a different game and if they win, well fair enough, but they might just end up with nothing.
I agree that CFK is hopeless and a disaster for Argentina. And her lunacy is digging Argentina deeper in to a hole, but on the default issue...she's not at fault.
They also need to adhere/abide by the terms of their note, contracts, & int'l agreements/treaties. This is where the Ks are at fault.
Nestor was an arrogant schmuck and CFK is worse.
Argentina will eventually have to negotiate. The holdouts can outlast the gov't which looks more likely to fall every day.
The USA is driving their expulsion from the Int'l banks. If they don't come into alignment soon and pay their ICSID judgements they're going to be in a world of hurt. It just beginning.
The only solutions is a Dictator like Pinochet to rid them of the corruption and make the people work otherwise it will stay on the road to ruin.
I am pretty sure there is not enough U$ to pay for the LNG they need to keep the lights on and the people warm this winter.
They are really tapped out, even worse than last year and they had 100s or business shut down for a long periods time because of the lack of gas.
CFK may have the same ending as Mussolini getting dragged through the streets by her extensions.
Hep, There is no Democracy in Argentina never has been. It is a documented fact votes are bought by whomever is in power. If you actually lived there you would know that.
You obviously have never been there it was even worse with CFK.
Which is probably why they are having such a terrible time keeping the electricity on now. Free a/c and heat gives you a very big drain on your resources.
They're too stupid to think about the long term consequences though
Watching this report I'm am reminded of the shocking and immoral tactics used by some associated with the GOP in their efforts to disenfranchise the poor.
This is the headline:
Corruption in Argentinian Election 10/28/2007
You are really dumb Hepatia.
Did you know the “welfare” payments are made in cash? No chance of corruption there. No
With the Australian Ballot vote buying is almost impossible. This fact was a major reason why this ballot was introduced. I thought that this report would show how it might be done but it doesn't - because this is not what is happening in this piece.
This report is right up there with some of the worst of Fox News. It is produced for the benefit of the gullible.
Hep.....you make it sound like Fox news is the only news in the USA.....would you like a count of news channels in the USA....we have it all from the extreme liberal to the extreme conservative......but no government propaganda news channels where everyday is sunshine and roses up your ass.
@30 you must've been in the rich neighborhoods, the only places where the peronists are the mayority. Most people in Argentina are Peronists. The Peronists are by far the dominant ideology, they control the media, the trade unions, most of the political parties, even the Radicals and the Socialists combined won't get half as many votes as the Peronists. CFK can end up as Mussolini, but the Peronists will keep in charge.
All I know is, if you world powers want to punish Argentina, you will not only cause poverty on a massive scale, but also genocide, because as far as I know there is NO politician in Argentina who is capable of rebuilding the country, the Peronists made that impossible, nobody in Argentina knows how to even pay the debt, for all we know it's unpayable and I don't think people will want to listen to the IMF.
www.plataformademocratica.org/Publicacoes/19776.pdf
IF and it is a big IF you are Argentinian you know you've never had democracy and never will.
Democracy in Argentina is possible with foreign intervention, though I don't see that very likely. If it wasn't for Peron we could have a real democracy.
Is this the best that you can do?
now go away
retard
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