Kicillof Pays To 92% Of Bondholders, Griesa's Move Now?

[French jurist]

Besides, around here it's long past midnight, so I'll get to bed.

This halo of mistery around you, the fact you used "Don" in your nickname and your avatar pic are useful additional information. If you are annoyed by contradiction, you'll say I Leave! but you won't. You'll say you'll ignore... while spending hours to answer, ignite new subjects, while not answering.

You went to buy bacon once at Mercado Central, another lead.

You're indeed good at something.

 

[toongeorges]

14 years ago the Belgian Appeals Court interpreted 'pari passu' exactly as it later is in the Argentine prospects, and exactly like judge Griesa interpreted it, and exactly as it is interpreted in commercial law.

I am sorry for my limited knowledge about law, but aren't you confusing 2 different systems: Anglo-Saxon law versus Continental European/Napoleonic law?
Anglo-Saxon law works by looking for precedents. Continental European law works by interpreting codified rules.

I find it strange that a New York judge would look for a precedent in an interpretation of a rule as codified in Belgian law by Belgian politicians. Would the precedent not have to be limited to previous applications of US law?

 

[Matiasba]

deleted

 

[Jaredberryman]

Regardless of what happens, there need to be some rules for sovereign countries that default that are similar to bankruptcy. In the real world, when bad things beset people and they cannot pay their bills due to debt, we don't sell them into slavery or make them homeless. We let them enter into bankruptcy so they can get their house in order. I clearly have very little understanding of economics, but why don't laws exist for sovereign corrupt third world nations that can't pay their debts? Shouldn't something exist like that? It seems like so many third world nations are caught in a cycle of poverty and perpetual debts. It doesn't seem like this is good for the average joe, and only good for those who have large amounts of money to invest in bonds. I think it's fundamentally right that third world nations should not be allowed to default, they should have a way out that makes better sense.

 

[Don Alberto]

I have to give you this Alberto: I've never seen anybody who can match your ability to take a misconception and then argue for it so tenaciously and actually quite effectively. In that sense, in spite of your being blatantly wrong, you have my admiration.

I do have a couple of quick questions though.

1. Do you think that stocks should also be guaranteed the same way you are arguing sovereign bonds should? What about other risky investments (venture capital, lottery, casinos...)?

2. Do you understand what such guarantees would do to yields? With global yields at an all-time low, developing market sovereign bonds are one of the few places investors can get a yield over 4%. Do you understand what would happen to investment in developing markets if they could no longer offer those returns because they guaranteed their repayment?


Again, I don't agree with you, but I dig your style.

A1: Stocks, venture capital (meaning: to risk), etc. are well known to be risky as opposed to bonds, thus providing higher yields. The answer is thus No, financial capital based on stocks, venture, etc. should not be guaranteed, they are by definition risk prone.

Casinos are completely different, as they represent a guaranteed loss. If people could win in a casino, there wouldn't be any casinos. Although a few individuals wins, the majority loses even more to finance the casino and its return on capital.

A2: A guarantee does of course reduce yields. Providing a guarantee in one of the forms I have previously written about (guano, railrods, ...) cost nothing provided the borrower doesn't default on it's debt.

Perhaps you will answer at least some of my outstanding questions?

You claim that "the bonds were sold at a higher interest rate because of the risk of default"

In this connexion the outstanding question is: How much higher interest rate than other bonds issued at the same time?

In this thread are a further 10 to 15 unanswered questions. I don't have the energy to list them, as yesterday the temperature was 32C, last night 26C (barely slept), and right now it's 33C.

 

[Don Alberto]

I am sorry for my limited knowledge about law, but aren't you confusing 2 different systems: Anglo-Saxon law versus Continental European/Napoleonic law?
Anglo-Saxon law works by looking for precedents. Continental European law works by interpreting codified rules.

I find it strange that a New York judge would look for a precedent in an interpretation of a rule as codified in Belgian law by Belgian politicians. Would the precedent not have to be limited to previous applications of US law?

I assume you got this impression from my list. There is, however, no indication that Griesa used the Belgian appeal court's ruling as a precedent.

The arguments for his ruling and the US appeal court's acceptance of his interpretation is described in
"United States Court of Appeal's ruling, NML Capital, Ltd. v. Republic of Argentina"
http://www.shearman....ision110512.pdf