US judge lifts block on billions in Argentine debt payments

[Zorro]

Source: AFP

A New York judge on Wednesday removed injunctions preventing Argentina from making payments on its debt, opening the way for a resolution of a decade-old dispute with hedge fund creditors.

Judge Thomas Griesa said Argentina's efforts to reach deals to settle the drawn-out legal case over billions of dollars in defaulted bonds merited the lifting of the injunctions he had placed in 2012.

Griesa pointed to the agreement by the new Argentine government of President Mauricio Macri to repayment terms with most of the major "holdout" bondholders in recent weeks, and to Macri's call Tuesday for the Argentine Congress to cancel its own block on paying the holdouts.

"Circumstances have changed so significantly as to render the injunctions inequitable and detrimental to the public interest," Griesa said.

Read more: http://news.yahoo.com/us-judge-lifts-block-billions-argentine-debt-payments-230633986.html

[forest444]

1. "Circumstances have changed as to render injunctions inequitable & detrimental to public interest"

Translation: It looks like my sugar daddy is getting his 1,600% payout, so I don't see why Argentina's legitimate bondholders (the 92.4% whose payments were illegally blocked) can't start collecting again.

But the article neglects to mention that Greasa made lifting this injunction contingent on having the Argentine Congress pass two very outrageous bills:

*One that accommodates holdouts by paying out $4.65 billion to 6 money laundries that, all together, spent around $300 million on bonds that today worth at most $1 billion (which is all they're really entitled to). The payout even includes $200 million in legal fees.

*And another that eliminates the National Bank of Argentina as a paying agent to bondholders - which, along with Paris, has been the only venue by which many legitimate bondholders have been able to collect since Greasa's blocks came into effect in July 2014.

This second point is particularly important because Greasa has made New York a completely unreliable venue in which to issue and service sovereign bonds (which is why so much of the global bond market has migrated to London, Paris, and Frankfurt since 2014).