Singing “Happy Days Are Here Again” and partying hearty is fun until the end of the month when the credit card bill arrives. Argentina got theirs and found out the interest rate is much higher than believed.
Once more that Socialist country’s economy circles the drain, in default with the hedge find debts which if paid would have required offering similar terms to other bondholders.
Over the edge into the deep water again.
Argentina Declared in Default by S&P as Talks Fail
Standard & Poor’s declared Argentina in default after the government missed a deadline for paying interest on $13 billion of restructured bonds.
The South American country failed to get the $539 million payment to bondholders after a U.S. judge ruled that the money couldn’t be distributed unless a group of hedge funds holding defaulted debt also got paid. Argentina, in default for the second time in 13 years, has about $200 billion in foreign-currency debt, including $30 billion of restructured bonds, according to S&P. [snip]
“The full consequences of default are not predictable, but they certainly are not positive,” Pollack wrote in an e-mailed statement. “Default is not a mere ‘technical’ condition, but rather a real and painful event that will hurt real people.”
Kicillof, speaking at the Argentine consulate in New York, told reporters that the holdouts rebuffed all settlement offers and refused requests for a stay of the court ruling. He said Argentina couldn’t pay the $1.5 billion owed to the hedge funds because doing so would trigger clauses requiring the country to offer similar terms to other bondholders. He also criticized the judge in the case and ratings agencies.
Such a piddling amount when compared to our national debt. The only thing currently saving us is the printing press; the world still takes the dollar as the reserve currency. T BRIC’s are working on changing that. If America’s dollar loses it’s status as the reserve currency, with the debt we have, we’ll become a third world country with nothing but debt and no way to purchase imports.
This probably is Obama’s goal: To reduce America to penury.