Argentina economy set to go BOOM!

Anything at all (keep it clean) goes here that does not fit in to any of the other forums.

Moderator: eeuunikkeiexpat

griffin
Rank: Chile Forum Citizen
Posts: 182
Joined: Tue Feb 03, 2009 4:40 pm
Location: La Serena

Re: Argentina economy set to go BOOM!

Post by griffin » Tue Oct 09, 2012 9:59 am


User avatar
nwdiver
Rank: Chile Forum Citizen
Posts: 3076
Joined: Tue Mar 17, 2009 8:45 pm
Location: Vancouver, BC and Chile where ever it's Summer
Contact:

Re: Argentina economy set to go BOOM!

Post by nwdiver » Thu Oct 11, 2012 3:27 pm

They are at it again, now state bond issuers can’t get dollars to pay their local dollar bond holders, SO GUESS WHAT they will use pesos!!!!!!

Thus they can reduce the payment drastically as the peso rises with inflation, of course this is what they did in 2002 and screwed over both internal and external dollar bond holders, now they are going to do it again. I would expect they will never sell a dollar based bond ever again, well they will try but not have any takers.

http://www.voxxi.com/argentina-credit-d ... s-holders/
It's all about the wine.

User avatar
admin
Site Admin
Posts: 21063
Joined: Sat Aug 26, 2006 11:02 pm
Location: Frutillar, Chile
Contact:

Re: Argentina economy set to go BOOM!

Post by admin » Fri Oct 12, 2012 8:51 am

Hey, that credit rating is just B for bullshit. They are as big a criminals as the Argentina government. A downgrade of a country that is dismantling its market economy piece by piece, and has essentially no open foreign exchange gets a B? Really? Seriously?

Giving Argentina a B is the same as saying all those mortgages were legit in the States. There explanation makes just about as much sense. They are equating Argentina ignoring or manipulating their debts (they refuse to call it a default) with paying down their debts.

Sorry, anyone that holds an Argentina bond after the last mess, gets exactly what they deserve. Screwed.

Just frigen say it S&P!!!!

ARGENTINA HAS DEFAULTED!!!!!

Who are they protecting? I am sure a bunch of international banks, holding junk Argentina bonds, that got caught without a chair when the music stopped (again). A full downgrade, would mean a whole lot of institutions would have to dump the worthless junk bonds automatically on to the market.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

Andres
Rank: Chile Forum Citizen
Posts: 2706
Joined: Mon May 30, 2011 3:09 am
Location: Ex Chile; returned to Oz

Re: Argentina economy set to go BOOM!

Post by Andres » Fri Oct 12, 2012 10:19 am

I wonder whether the Fed "quantitative easing" guidelines allow or will allow the Fed to buy Argentine bonds . . . because "big boys" have "friends" (infiltrated) in the US government.
Chile: My expectations are low. Very low.
I accept chaos. I'm not sure whether it accepts me.

User avatar
eeuunikkeiexpat
Rank: Chile Forum Citizen
Posts: 8063
Joined: Fri Sep 01, 2006 1:38 am
Location: Megalith of unknown origin near my digs, south V Region coast

Re: Argentina economy set to go BOOM!

Post by eeuunikkeiexpat » Fri Oct 12, 2012 10:49 am

Keep on eye on all the measures simple to technologically enhanced that Argentina is using and soon other countries will use to control capital fleeing. Are they not a developing world testing ground for measures to be implemented in the USA in the not so distant future? Except the Argentina elite still have a trump card with their gold hoard.
There are two ways to be fooled.

One is to believe what isn't true;

the other is to refuse to believe what is true.

- Søren Kierkegaard

User avatar
nwdiver
Rank: Chile Forum Citizen
Posts: 3076
Joined: Tue Mar 17, 2009 8:45 pm
Location: Vancouver, BC and Chile where ever it's Summer
Contact:

Re: Argentina economy set to go BOOM!

Post by nwdiver » Fri Oct 12, 2012 4:01 pm

admin wrote:Hey, that credit rating is just B for bullshit. They are as big a criminals as the Argentina government. A downgrade of a country that is dismantling its market economy piece by piece, and has essentially no open foreign exchange gets a B? Really? Seriously?

Giving Argentina a B is the same as saying all those mortgages were legit in the States. There explanation makes just about as much sense. They are equating Argentina ignoring or manipulating their debts (they refuse to call it a default) with paying down their debts.

Sorry, anyone that holds an Argentina bond after the last mess, gets exactly what they deserve. Screwed.

Just frigen say it S&P!!!!

ARGENTINA HAS DEFAULTED!!!!!

Who are they protecting? I am sure a bunch of international banks, holding junk Argentina bonds, that got caught without a chair when the music stopped (again). A full downgrade, would mean a whole lot of institutions would have to dump the worthless junk bonds automatically on to the market.


That’s the story behind the seizure of the Libertad, the so called vulture funds are just that, they didn’t hold Argie bonds at the top they bought a handful at the bottom then never settled so have a legitimate claim, then they chase assets, it’s sort of “green mailing” but that’s easier to do to a big company than a country. Their currency is a B but if you look at S&P it is an unsolicited rating and B is one step above “RUN FAST” CCC, BBB is not good, B is 3 steps lower, Bolivia gets a BB-, Peru gets BBB, Chile is A+, USA AA+. Only a handful of AAA are still around. Next go around or sooner it will collapse to a C, I think it will skip the CCC and CC levels.
It's all about the wine.

User avatar
admin
Site Admin
Posts: 21063
Joined: Sat Aug 26, 2006 11:02 pm
Location: Frutillar, Chile
Contact:

Re: Argentina economy set to go BOOM!

Post by admin » Fri Oct 12, 2012 4:19 pm

I was curious about what their status was back in 2001, so had a look. Seems the S&P still could not bring themselves to call it a default, even though they were getting C's.

How about a trip down memory lane of the sucker and bust cycle of Argentina economics?
S&P Cuts Argentina's Credit Rating to Just Above Default Status
Latin America: Stock and bond prices stabilize as president plans a meeting with provincial leaders.
October 31, 2001|GENEVIEVE WILKINSON | REUTERS

NEW YORK — Credit agency Standard & Poor's Corp. on Tuesday cut its long-term sovereign credit rating for Argentina to just one notch above default status, citing the likelihood the country would restructure its debt and cost bondholders some of their investment.

Meanwhile, Argentine stock and bond prices stabilized after diving on Monday.

President Fernando de la Rua said the country continued to work on a "voluntary, consensual" local debt restructuring, and the government tried to dispel default fears.

But S&P downgraded its ratings on the long-term debt of Latin America's third-largest economy to double-C from triple-C-plus. S&P affirmed its single-C rating for the nation's short-term debt and kept the outlook for the debt at negative.

No other emerging-market economy holds such a low S&P rating.

"The downgrade reflects the increased probability that Argentina will decide to comprehensively restructure its internal and external debt as signaled by government officials that have now made debt restructuring a priority solution to the fiscal and economic crisis," S&P said in a statement.

The downgrade comes one week after S&P said it would cut Argentina's credit ratings to "selective default" if bondholders suffered a loss in the debt exchange deal the government has been negotiating on its $132-billion debt load for months.

Prices of Argentine bonds have sunk to historic lows in recent days as Economy Minister Domingo Cavallo has forged on with a program he says will allow investors to voluntarily exchange high-interest-bearing bonds for new debt paying lower rates.

Racked by recession and its enormous debt load, Argentina has been struggling financially for much of the last year.

Argentine bond prices moved up slightly on Tuesday, while the Merval stock index gained 1.8% to 223.58 after plunging 8.7% Monday.

In other Latin American trading, Brazil's key stock index fell 3.1% while Mexico's main stock index lost 1.2%.

A default by Argentina would scar the country's credit history, potentially blocking it from capital markets and pushing already sky-high interest rates even higher.

"Evidently the ratings agencies don't want to be accused of missing the default, but we continue to believe that Argentina will prove to be the most anticipated default that never took place," said Arturo Porzecanski, head of emerging markets economics at brokerage ABN AMRO.

In explaining the decision to downgrade the credit, S&P said implementation of the government's plan to cut its budget deficit to zero is almost impossible with tax revenues dropping--unless interest payments to bondholders are lowered.

President de la Rua is laboring to convince provincial governors to accept reduced federal funding, freeing up some government money for debt payments, in return for help in restructuring provincial debt.

Those talks stalled last week, but De la Rua has called provincial leaders back to the table today.

One great question mark is whether the United States again would come to the aid of Argentina.

The International Monetary Fund, heavily influenced by the U.S., already has bailed Argentina out to the tune of $22 billion since December with guarantees on debt payments.
Then by 2006, we have the words "booming" used in reference to the economy.

Argentina's Credit Rating at Highest Level Since 2001 (Update2)
By Heather Walsh and Matthew Walter - October 2, 2006 17:55 EDT

Oct. 2 (Bloomberg) -- Argentina had its debt rating lifted by Standard & Poor's to its highest level in more than five years as an expanding economy boosts tax revenue and leads to budget surpluses.

S&P raised Argentina's long-term foreign and local currency credit ratings by one level to B+, four levels below investment grade and in line with countries such as Ghana and Pakistan. The outlook on the ratings is stable, S&P said today in a statement

``Debt has gone down,'' said Joydeep Mukherji, an analyst at S&P. ``It's basically because of good economic performance this year. There is momentum to carry that into next year.''

Argentina, South America's second-largest economy, is benefiting from rising demand for exports such as soybeans and textiles that will help the economy expand for a fourth year in 2006, Mukherji said by phone in New York. Argentine President Nestor Kirchner also is posting budget surpluses, which has helped to trim the government's debt, Mukherji said. The ratings increase will probably bolster the nation's bonds, said Pablo Morra, an economist at Goldman Sachs Group Inc.

``It's good news for investment,'' Morra said in a telephone interview from New York.

The yield on Argentina's benchmark 5.83 percent bond due in December 2033 slid 3.5 basis points, or 0.035 percentage point, to 6.493 percent, its lowest level since Sept. 20 and down from 7.154 percent on June 27.

Argentina's economy is strengthening following a four-year recession that deepened in 2002 after the government's debt default in December 2001 and its decision the following month to scrap the Argentine peso's one-to-one peg to the dollar.

`Strong'

Overall public sector debt may fall to less than 60 percent of gross domestic product next year from 80 percent in 2005, as the government posts budget surpluses, S&P said today. The ratings increase was S&P's third for Argentina since June 2005.

``When you look at Argentina vis-à-vis other emerging markets, you see its relatively strong fiscal and financial position,'' Gustavo Canonero, chief Latin America economist at Deutsche Bank in New York. ``This upgrade was not a surprise.''

Argentina may be able to improve its rating before presidential elections in 2007, Canonero said by phone.

The cities of Buenos Aires and Mendoza also had their foreign and local currency ratings lifted today to B+ from B by S&P.

`Booming'

Argentina's Merval stock index gained 0.8 percent to 1,651.08, extending its gain for the year to 7 percent. The Argentine peso, which has gained 6.3 percent in a year, was little changed at 3.1030 per dollar at 5:35 p.m. New York time.

Argentina, which defaulted on about $100 billion of debt, now is benefiting from a weaker currency that has boosted manufacturing exports and led to a surge in tourism, Mukherji said.

``You paid a huge price but now are able to reap some of the benefits,'' Mukherji said. ``The economy is booming. Money is coming in.''

Argentina's economy will grow 8 percent in 2006 and 6 percent in 2007, following a 9.2 percent expansion in 2005, the International Monetary Fund forecast last month.

Faster growth and a weaker currency, along with a natural gas shortage as demand surges, also has led inflation to accelerate. Argentina's annual inflation rate was 10.7 percent in August, more than double the rate two years earlier.

Kirchner has pressed the nation's companies, including gasoline stations and supermarkets, to freeze prices, and temporarily slapped bans on beef exports to keep consumer prices from surging.

Such policies, which have helped to keep inflation in check, may hurt growth if they continue, along with the possibility for a higher credit rating, S&P said today.

Argentina, while slashing its debt as a percentage of gross domestic product since 2002, still has the highest debt level among 16 Latin American nations tracked by the IMF.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

User avatar
Dosedmonkey
Rank: Chile Forum Citizen
Posts: 987
Joined: Wed Jun 15, 2011 12:27 am

Re: Argentina economy set to go BOOM!

Post by Dosedmonkey » Sun Oct 14, 2012 6:28 pm

You know its bad when you got to take loans from Ghana and not pay them back.
http://www.bbc.co.uk/news/world-africa-19910141

User avatar
ABIII
Rank: Chile Forum Citizen
Posts: 263
Joined: Tue Aug 23, 2011 2:39 pm

Re: Argentina economy set to go BOOM!

Post by ABIII » Thu Oct 18, 2012 3:06 pm

I'm sure negotiations with Hollywood are already going on for the movie rights

a ship, an international crisis, sailors marooned in an exotic port indefinitely
adventure, romance, espionage!

all this and a ship called "Freedom"
:pirate:
Based in Chile - 1990
Lake District - 2009

User avatar
admin
Site Admin
Posts: 21063
Joined: Sat Aug 26, 2006 11:02 pm
Location: Frutillar, Chile
Contact:

Re: Argentina economy set to go BOOM!

Post by admin » Thu Oct 18, 2012 3:58 pm

Is the ship even worth $20 million US in today's market?

They should just scuttle it, and tell the guys trying to collect to come get it. It would be like the Boston tea party in reverse or something.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

User avatar
nwdiver
Rank: Chile Forum Citizen
Posts: 3076
Joined: Tue Mar 17, 2009 8:45 pm
Location: Vancouver, BC and Chile where ever it's Summer
Contact:

Re: Argentina economy set to go BOOM!

Post by nwdiver » Thu Oct 18, 2012 4:09 pm

admin wrote:Is the ship even worth $20 million US in today's market?

They should just scuttle it, and tell the guys trying to collect to come get it. It would be like the Boston tea party in reverse or something.


According to the press the ship is “priceless” ;)
It's all about the wine.

User avatar
admin
Site Admin
Posts: 21063
Joined: Sat Aug 26, 2006 11:02 pm
Location: Frutillar, Chile
Contact:

Re: Argentina economy set to go BOOM!

Post by admin » Thu Oct 18, 2012 5:18 pm

Yea, but the titanic is even more priceless. Had it not sunk, it would have been recycled in to a refrigerator by now. They can think of it as preserving a national treasure, so that Christina does not pawn it for the next round of botox injections.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

Post Reply