22 November 2012

ARGENTINA / USA : 24 Nov UPDATE: Cristina's Options Limited After NYC Judge Orders $1.33 Billion Payout...Or Else! With Salmon Analysis.

           IST LINK CHANGE

     An NYC judge...exasperated by 10 years of litigation...ordered Argentina to pay so-called 'vulture funds'...NML Capital and others...$1.33 billion...for its sovereign bonds and interest...when it pays other holders of some $60 billion of its renegotiated sovereign debt...their $3.4 billion of interest payments due in December.
      President Kirchner has long vowed to never pay 'scavenger' stakeholders for debts she calls illegitimate...because they were acquired under a dictatorship from 1976-83.
     But Kirchner has few options.
     District judge Thomas Griesa, 82...will allow payments put into escrow by 15 December...while Buenos Aires appeals his decision.
      This is a complex legal and financial issue involving a 2001 default...2 renegotiations... and possibly a future default by Argentina.
      Kirchner's popularity is also at a new low.
      The decision follows by days a mammoth 24 hour national strike against her government...the biggest in a decade.
     This decision is also important for the precedent it might set...for other nations...and future debt defaults...because no party would accept debt restructuring...if they could wait...sue...and eventually obtain 100%.
    A top Argentine official called the decision 'judicial feudalism.' (WSJ)

      TO READ : Detailed but technical analysis...by Felix Salmon.