Argentina Defaults: Three Points
July 31, 2014
... Argentina failed to reach an agreement with several hedge funds holding its bonds and it defaulted on its debt payments. First, S&P lowered the country’s rating to “selective default,” which means that Argentina had failed to make some interest payments on its bonds. Then, Argentina’s economy minister ... Axel Kicillof, said that the “vulture” hedge funds had declined to accept Argentina’s offer to swap out their bonds for new ones, and that he was therefore heading home.
http://www.businessweek.com/articles/2014-07-31/argentina-defaults-three-points
Default is a major disaster for a government, but not much will happen right away now that Standard & Poor’s has declared Argentina to be in “selective default.”S&P (MHFI) took the action today after Argentina’s talks with holdout creditors continued past the end of the 30-day grace period for a $539 million bond payment.
Defaults are usually bad for bond prices. But prices for Argentine bonds soared today ... because investors are increasingly optimistic that Argentina will strike a deal with its creditors. ...
http://www.businessweek.com/articles/2014-07-30/what-happens-now-that-argentina-is-in-selective-default
This sounds exciting.
I've not read up on bonds, but there's a link - here - for anyone that's keen.
Looks like Argentina's borrowed money that it can't pay back.
Doesn't sound too good.
Too tired to try to figure it out beyond that.
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