Download or read book Argentina s Defaulted Sovereign Debt written by J. F. Hornbeck and published by DIANE Publishing. This book was released on 2010-11 with total page 18 pages. Available in PDF, EPUB and Kindle. Book excerpt: In Dec. 2001, Argentina suffered a severe financial crisis, leading to the largest default on sovereign debt in history. In 2005, Argentina made a one-time unilateral offer on terms highly unfavorable to the creditors. Although 76% of creditors accepted the offer, a diverse group of ¿holdouts¿ opted instead for litigation in hopes of achieving a better settlement in the future. Argentina still owes private creditors $20 billion in defaulted debt and $10 billion in past-due interest, as well as $6.2 billion to Paris Club countries. Contents of this report: Recent Developments; Background to the Current Debt Restructuring; Restructuring Sovereign Debt; Argentina¿s Debt Profile and Rationale for Restructuring (Again); The 2010 Exchange; Outlook. Illustrations.

Download or read book Default written by Gregory Makoff and published by Georgetown University Press. This book was released on 2024-02-01 with total page 250 pages. Available in PDF, EPUB and Kindle. Book excerpt: The dramatic inside story of the most important case in the history of sovereign debt law Unlike individuals or corporations that become insolvent, nations do not have access to bankruptcy protection from their creditors. When a country defaults on its debt, the international financial system is ill equipped to manage the crisis. Decisions by key individuals—from national leaders to those at the International Monetary Fund, from holdout creditors to judges—determine the fate of an entire national economy. A prime example is Argentina’s 2001 default on $100 billion in bonds, which stands out for its messy outcomes and outsized impact on sovereign debt markets, sovereign debt law, and IMF policy. Default is the riveting story of Argentina’s sovereign debt drama, which reveals the obscure inner workings of sovereign debt restructuring. This detailed case study describes the intense fight over the role of the IMF in Argentina’s 2005 debt restructuring and the ensuing bitter decade of litigation with holdout creditors, demonstrating that outcomes for sovereign debt are determined by a complex interplay between financial markets, governments, the IMF, the press, and the courts. This cautionary tale lays bare the institutional, political, and legal pressures that come into play when a country cannot repay its debts. It offers a deeper understanding of how global financial capitalism functions for those who work in or study debt markets, international finance, international relations, and international law.

Download or read book Crs Report for Congress written by Congressional Research Service: The Libr and published by BiblioGov. This book was released on 2013-11 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: In December 2001, Argentina suffered a severe financial crisis, leading to the largest sovereign debt default in history. In 2005, after prolonged, contentious, and unsuccessful attempts to restructure the debt, Argentina abandoned the negotiation process and made a unilateral offer. The terms were highly unfavorable to creditors, but $62.3 billion of the $81.8 billion in principal owed was exchanged. A diverse group of "holdouts" representing $18.6 billion did not tender their bonds and some have opted to litigate instead. These actions resulted in attachments orders against Argentine assets, leaving the country unable to access the international credit markets and mired in litigation. Holdout creditors also lobbied against Argentina's debt policy, which has triggered actions by the U.S. government and legislation in Congress (H.R. 1798 and S. 912 in the 112th Congress). The lingering effects of the debt default became a legacy problem for Argentina. The government decided to open another bond exchange in 2010 to deal with remaining holdouts, on slightly less favorable terms than before. Argentina reduced its outstanding defaulted debt by another $12.4 billion. As of December 31, 2010, Argentina reported that it owed private investors $11.2 billion ($6.8 billion in principal and $4.4 billion in past due interest). Holdout creditors estimate that with additional interest, this number could be as high as $15 billion by 2013, with $1.3 billion under litigation in federal court. Argentina also owes the Paris Club countries $6.3 billion in principal plus past due interest and penalties. The U.S. portion is estimated at $550 million.

Download or read book Default and Adjustment of Argentine Foreign Debts 1890 1906 written by Henry Longdon Shepherd and published by . This book was released on 1933 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book What Life After Default written by Giselle Datz and published by . This book was released on 2007 with total page 612 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Argentina and the Fund written by Michael Mussa and published by Peterson Institute. This book was released on 2002 with total page 116 pages. Available in PDF, EPUB and Kindle. Book excerpt: The catastrophic crisis of late 2001 and early 2002 marks the tragic end to Argentina's initially successful, decade-long experiment with sound money and market-oriented economic reform. The IMF consistently Supported Argentina's stabilization and reform efforts in the decade leading up to the current crisis and often pointed to many of Argentina's policies as examples for other emerging-market economies to emulate. In this policy analysis, former IMF Chief Economist Michael Mussa addresses the obvious question: What went wrong in Argentina and what important errors did the IMF make in either supporting inappropriate policies or in failing to press for alternatives that might have avoided catastrophe? He emphasizes that the persistent inability of the Argentine authorities at all levels to run a responsible fiscal policy--even when the Argentine economy was performing very well--was the primary avoidable cause of the country's catastrophic financial collapse. The IMF failed to press aggressively for a more responsible fiscal policy. Mussa also addresses the role of the Convertibility Plan, which linked the Argentine peso rigidly at parity with the US dollar and played a central role in both the initial success and ultimate collapse of Argentina's stabilization and reform efforts. While the IMF accepted this plan as a basic policy choice of the Argentine authorities so long as it remained viable, it erred in the summer of 2001 by extending further massive support for unsustainable policies, rather than insisting on a new policy strategy that might have mitigated some of the damage from a crisis that had become unavoidable. Mussa lays out what needs to be done to restore economic andfinancial stability in Argentina and begin the process of recovery, including the proper role of the IMF and the international community. He also examines what the IMF can do to avoid repeating the types of mistakes it made in t

Download or read book Argentina s Sovereign Debt Restructuring written by and published by . This book was released on 2004 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In December 2001, after four years of deepening recession and mounting social unrest, Argentina's government collapsed and ceased all debt payments. Argentina has failed to pay before, but this time it registered the largest sovereign default in history. Argentina must restructure over $100 billion owed to domestic and foreign bondholders, including $10 billion held by U.S. investors. A final offer made in June 2004 amounted to a 75% reduction in the net present value of this debt, and although an improved offer is expected by year-end, it is still the largest proposed write-down in the history of sovereign restructurings, which foreign bondholders have rejected. Regardless of how Argentina's debt is finally resolved, it will likely represent an unprecedented loss for bondholders. This will have widespread repercussions not only for creditors, but for Argentina's long-term financial sustainability, developing country debt markets, guidelines for future sovereign debt restructurings, and the International Monetary Fund (IMF). All of these issues have been the subject of congressional hearings focused on evaluating the causes and ongoing repercussions of Argentina's financial crisis. Argentina must settle with foreign bondholders if it is to return to the sovereign debt market, which will be necessary for financing investment in long-term growth. Argentina has made a reasoned case that its debt is simply too big to repay; nonetheless, the default is not only unprecedented for its low recovery rate, but also for the process that has stretched (creditors would say flaunted) the guidelines of sovereign debt negotiations. This applies to both informal negotiation guidelines understood to be in play by bondholders, and a more formal understanding as embodied in the IMF's policy of lending into private arrears. Argentina's experience raises important questions in at least three major policy areas: country decisions to default on debt, codes of conduct for emerging market debt restructurings; and the role of the IMF in helping resolve financial crises. Although other countries may look to Argentina as a model for reneging on sovereign debt, the cost of Argentina's financial collapse in long-term social and economic terms has been devastating. For investment firms and other holders of emerging market debt, there is no denying that the huge loss taken on a default like Argentina's is a highly negative precedent. The fact that debt workouts are being completed, even if not always smoothly or in a timely fashion, may suggest that the "market system with IMF assistance" approach is still preferable to taking another shot at reinventing the international financial architecture, including creating some type of sovereign bankruptcy option. But should the Argentine case fail to be resolved to the mutual satisfaction of all parties, it could reinvigorate interest in a systematic and internationally recognized debt restructuring system, because as Argentina has shown, once insolvency occurs and debt becomes far too large to manage, there may be little incentive for countries to work with the existing unenforceable system in finding a quick and consensual solution. This report will be updated periodically.

Download or read book Sovereign Debt Restructurings 1950 2010 written by Mr.Udaibir S. Das and published by International Monetary Fund. This book was released on 2012-08-01 with total page 128 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper provides a comprehensive survey of pertinent issues on sovereign debt restructurings, based on a newly constructed database. This is the first complete dataset of sovereign restructuring cases, covering the six decades from 1950–2010; it includes 186 debt exchanges with foreign banks and bondholders, and 447 bilateral debt agreements with the Paris Club. We present new stylized facts on the outcome and process of debt restructurings, including on the size of haircuts, creditor participation, and legal aspects. In addition, the paper summarizes the relevant empirical literature, analyzes recent restructuring episodes, and discusses ongoing debates on crisis resolution mechanisms, credit default swaps, and the role of collective action clauses.

Download or read book Sovereign debt default and financial crisis in Argentina 2001 written by Mark Schopf and published by GRIN Verlag. This book was released on 2010-11-30 with total page 20 pages. Available in PDF, EPUB and Kindle. Book excerpt: Seminar paper from the year 2010 in the subject Economics - Economic Cycle and Growth, grade: 1,7, Otto-von-Guericke-University Magdeburg (Internationale Wirtschaft), course: Seminar on financial crisis, language: English, abstract: In order to understand the causes of the Argentine economic crisis one has at least to know something about the Plan Cavallo which was established in Argentina in the year 1991. At the end of the 1980s the country suffered from hyperinflation with prices increasing above 3000 percent per year. This currency crisis was accompanied by an accumulated decrease of GDP between 1988 and 1990 of about 10 percent. After several failed attempts to stop this development the newly appointed minister of economic affairs, Cavallo, established two laws which improved the situation. First, the Ley De Convertibilidad came into effect that fixed the exchange rate between the Argentine currency and the U.S. dollar. Second, the Ley de Carta Orgánica del Banco Central emerged which obligated the central bank not to finance budget deficits anymore. These two laws became generally known as the Plan Cavallo. The incentive was to reestablish confidence in the sense that Argentina would not inflate away its domestic debt anymore. The Plan Cavallo operated very well until the crisis with respect to two macroeconomic quantities: On the one hand, the exchange rate was kept constant at a one-to-one level towards the U.S. dollar. On the other hand, the inflation rate declined from still 84 percent in the year 1991 to 1.6 percent in the year 1995. Since then it was kept between -1.8 and 0.7 percent until the year 2000. Furthermore, a lot of privatization took place in the first half of the 1990s and the whole decade was characterized by an increase of foreign direct investment above 500 percent. Altogether, Argentina was a “star” country in the perspective of international organizations. Nonetheless, there were some erroneous trends. First, there was a real revaluation of the Argentine peso with respect to the U.S. dollar: While the nominal exchange rate stayed constant, prices in Argentina rose by 153 percent, prices in the United States only by 30 percent from 1991 to 2000. In other words, assuming that prices of export and import goods increased by the same relation, exports from Argentina to the United States doubled in prices while imports to Argentina from the United States halved in prices during this period. Second, the debt ratio increased from 38.8 percent in the year 1991 to 50.8 percent in the year 2000 despite the fact that GDP grew by 4.2 percent on average during this period. In other words, the Argentine government pursued a pro-cyclical policy in the considered period.

Download or read book Restructuring Sovereign Debt After NML V Argentina written by Lee C. Buchheit and published by . This book was released on 2017 with total page 18 pages. Available in PDF, EPUB and Kindle. Book excerpt: The decade and a half of litigation that followed Argentina's sovereign bond default in 2001 ended with a great disturbance in the Force. A new creditor weapon had been uncloaked: The prospect of a court injunction requiring the sovereign borrower to pay those creditors that decline to participate in a debt restructuring ratably with any payments made to those creditors that do provide the country with debt relief. For the first time holdouts succeeded in fashioning a weapon that could be used to injure their erstwhile fellow bondholders, not just the sovereign issuer. Is the availability of this new weapon limited to the aggravated facts of the Argentine default or has it now moved permanently into the creditors' arsenal? Only time (and future judicial decisions) will tell. In the meantime, however, sovereigns will occasionally find themselves in financial distress and their debts will occasionally need to be restructured. Venezuela already casts this chilly shadow over the sovereign debt market. If, in a galaxy not too far away, sovereign debt workouts are to have any chance of an orderly completion, a method must be found to neutralize this new weapon. Judging by the secondary market prices of different series of Venezuelan sovereign bonds, large amounts of money are being wagered that it cannot be done.

Download or read book Collective Action Clauses and the Restructuring of Sovereign Debt written by Patrick S. Kenadjian and published by Walter de Gruyter. This book was released on 2013-08-01 with total page 280 pages. Available in PDF, EPUB and Kindle. Book excerpt: The volume contains articles based on presentations given at a conference hosted by the Institute for Law and Finance of Goethe University on October 27, 2011. Collective action clauses are an example of the typical dichotomy of financial regulation: While the problems are economic in nature, the solutions need to be implemented by law. The Institute for Law and Finance strives to bring together law and finance in order to foster a better mutual understanding of both disciplines and to improve the regulation of financial markets. Thus, the organizers are particularly pleased that eminent experts from the fields of law and finance agreed to participate in the event and to share their views on and experiences with collective action clauses. The presentations given at the conference have been updated in 2012 to reflect recent developments.

Download or read book Why Not Default written by Jerome E. Roos and published by Princeton University Press. This book was released on 2019-02-12 with total page 398 pages. Available in PDF, EPUB and Kindle. Book excerpt: How creditors came to wield unprecedented power over heavily indebted countries—and the dangers this poses to democracy The European debt crisis has rekindled long-standing debates about the power of finance and the fraught relationship between capitalism and democracy in a globalized world. Why Not Default? unravels a striking puzzle at the heart of these debates—why, despite frequent crises and the immense costs of repayment, do so many heavily indebted countries continue to service their international debts? In this compelling and incisive book, Jerome Roos provides a sweeping investigation of the political economy of sovereign debt and international crisis management. He takes readers from the rise of public borrowing in the Italian city-states to the gunboat diplomacy of the imperialist era and the wave of sovereign defaults during the Great Depression. He vividly describes the debt crises of developing countries in the 1980s and 1990s and sheds new light on the recent turmoil inside the Eurozone—including the dramatic capitulation of Greece’s short-lived anti-austerity government to its European creditors in 2015. Drawing on in-depth case studies of contemporary debt crises in Mexico, Argentina, and Greece, Why Not Default? paints a disconcerting picture of the ascendancy of global finance. This important book shows how the profound transformation of the capitalist world economy over the past four decades has endowed private and official creditors with unprecedented structural power over heavily indebted borrowers, enabling them to impose painful austerity measures and enforce uninterrupted debt service during times of crisis—with devastating social consequences and far-reaching implications for democracy.

Download or read book Banks Government Bonds and Default written by Nicola Gennaioli and published by International Monetary Fund. This book was released on 2014-07-08 with total page 53 pages. Available in PDF, EPUB and Kindle. Book excerpt: We analyze holdings of public bonds by over 20,000 banks in 191 countries, and the role of these bonds in 20 sovereign defaults over 1998-2012. Banks hold many public bonds (on average 9% of their assets), particularly in less financially-developed countries. During sovereign defaults, banks increase their exposure to public bonds, especially large banks and when expected bond returns are high. At the bank level, bondholdings correlate negatively with subsequent lending during sovereign defaults. This correlation is mostly due to bonds acquired in pre-default years. These findings shed light on alternative theories of the sovereign default-banking crisis nexus.

Download or read book What Did the Credit Market Expect of Argentina Default written by Frank X. Zhang and published by . This book was released on 2003 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Legislation of Argentina on Its Sovereign Debt written by Eugenio Bruno and published by . This book was released on 2015 with total page 16 pages. Available in PDF, EPUB and Kindle. Book excerpt: This article examines (i) the Argentine legislation relating to the management of its sovereign debt including the application of such regulatory framework to the default of 2001 and the Debt Exchanges as a background of the legal norms that will be needed in connection with the negotiation and resolution of the debt in default with the holders of the defaulted bonds (“Holdouts”) and the regularization of the payment of the bonds issued under the Debt Exchanges; (ii) the intersection between the legal architecture of the 2005 Debt Exchange and the court decisions in the NML v The Republic of Argentina case; and (iii) what specific legislative steps should be taken in order to restructure the Argentine debt in default.

Download or read book The Foreign Debt of the Argentine Republic written by Harold Edwin Peters and published by . This book was released on 1983 with total page 208 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book After Argentina written by Anna Gelpern and published by . This book was released on 2005 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt: