Argentina's Economics Minister Axel Kicillof was in New York Wednesday, giving a speech to the Group of 77+China, a group of 133 nations who expressed their collective support for Argentina in this fight. By Daniel Bases and Rodrigo Campos report in Argentina economy minister tells diplomats nation being pushed to default Reuters 06/26/2014:
Referring to those creditors as "vulture funds," Kicillof said the June 16 decision by the top U.S. court to deny Argentina the chance to appeal a lower court ruling means it faces an insurmountable payment to all existing bondholders, given it has just $28.5 billion in foreign currency reserves.The more serious deadline comes at the end of July. As Bases and Campos explain, "Argentina is due to make a $900 million coupon payment on June 30, but has a 30-day grace period in which to come to an agreement with the holdouts before a default can officially be declared."
"So probably this is going to push us into a technical default," Kicillof said through an interpreter. "Whichever way you look at it this ruling is forcing Argentina towards the risk of economic crisis."
The holdouts are led by Elliott Management's NML Capital and Aurelius Capital Management, two hedge funds that specialize in buying up deeply discounted or distressed debt and negotiating profitable settlements, often through the use of the courts.
Argentine Foreign Minister Héctor Timerman quoted Argentine President Cristina Fernández to the Group of 77+China ("La Argentina quiere pagar pero no la dejan" Página/12 26.2014):
Hoy los fondos buitre ponen en peligro el sistema financiero internacional. No se trata de Norte o Sur, sino de una economía de la producción contra una economía de la especulación.Kicillof announced today that Argentina has deposited the payments due for the renegotiated debt. (La Argentina pagó a los bonistas que ingresaron en el canje, para evitar el "default técnico" Página/12 26.2014; Government makes debt payment on restructured bonds, blasts Washington for judicial rulings Buenos Aires Herald 26.06.2014) The official unsigned statement issued in the name of the Argentine Presidency is in all caps. It characterizes the decision by Nixon-appointed Judge Griesa confirmed by the Roberts Court as "SOLO UN MODO SOFISTICADO DE INTENTAR PONERNOS DE RODILLAS ANTES USUREROS DE CARÁCTER GLOBAL" ("NOTHING BUT A SOPHISTICATED MODE OF INTENDING TO FORCE US ONTO OUR KNEES BEFORE USURERS OF A GLOBAL CHARACTER").
[Today the vulture funds are putting the international financial system in danger. It's not about North or South, but about an economy of production against an economy of speculation.]
Cristina is a fighter! The statement also says, "NO CABE LA MENOR DUDA DE LA PARCIALIDAD DEL JUEZ EN FAVOR DE LOS FONDOS BUITRES NI DE SU VERDADERA INTENCIÓN: LA DE PRETENDER LLEVAR A LA REPÚBLICA ARGENTINA AL DEFAULT" ("THERE IS NOT THE LEAST DOUBT OF THE PARTIALITY OF THE JUDGE IN FAVOR OF THE VULTURE FUNDS NOR ABOUT HIS REAL INTENTION: THAT OF ATTEMPTING TO PUSH THE REPUBLIC OF ARGENTINA INTO DEFAULT").
Nixon-appointed Judge Griesa a few days ago had mentioned a speech of Cristina's in a negative light. I guess she doesn't think a Nixon-appointed judge in the United States should be telling the twice-elected President of Argentina what she can say.
If I'm understanding this correctly, Argentina has deposited these funds, basically daring Nixon-appointed Judge Griesa to seize the money to pay to the vulture funds.
The Nixon-appointed federal judge has set a new hearing for Friday. (Griesa convocó a una audiencia para mañana Página/12 26.2014; Hugh Bronstein, Argentina deposits debt payment, but U.S. court blocks payout Reuters 06/26/2014) NML Capital is claiming that Argentina's attempt to pay the renegoiated creditors is a violation of Nixon-appointed Judge Griesa decision that was recently upheld by the Roberts Court.
Tags: argentina, axel kicillof, cristina fernández