Appeals Court opens way for Argentina to end battle with hedge funds.

[forest444]

The United States Court of Appeals paved the way on Wednesday for Argentina to raise billions of dollars to pay a group of hedge funds, bringing it one step closer to re-entering international markets for the first time in 15 years.

In a ruling from the bench, three judges on the court of appeals in New York upheld a ruling by Judge Thomas P. Griesa of the U.S. District Court in Manhattan to lift an injunction that has barred Argentina from paying most of its foreign bondholders since 2014. In March, the United States government weighed in on the battle, lending its support to Argentina in a “friend of the court” or amicus curiae brief.

The ruling caps years of bitter legal wrangling that goes back to 2001, when Argentina defaulted on nearly $100 billion of bonds. Over 92% of bondholders accepted two debt restructurings by Argentina in 2005 and 2010; but a small group of holdout investors refused to take part. Hedge fund billionaire Paul Singer, the principal litigant, bought defaulted Argentine bonds at a steep discount in 2008.

Argentina agreed on February 29 to pay $4.65 billion to four hedge funds including Singer’s Cayman Islands-based NML Capital, which would receive around half of that. As part of the deal, Argentina’s Congress had to repeal domestic laws that prevented the government from paying the holdouts, which it has now done. Argentina was also required to pay the investors by April 14, after which the hedge funds could walk away from the deal.

Argentina asked that Judge Griesa’s original injunction be lifted after it made an offer to pay $6.5 billion to settle lawsuits from other holdout bondholders on Feb. 5, which the Appeals Court today did. There are still some disgruntled bondholders who were not part of the $4.65 billion deal with the four hedge funds. They have argued that they will receive far worse terms if they agree to Argentina’s $6.5 billion proposal.

Argentina is now poised to raise more than $12 billion through bond sales, the proceeds of which will pay its holdout cbondholders. Top officials from Argentina will travel to New York and other American cities this week to meet with potential investors.

“This is going to be settled next week,” Alfonso Prat-Gay, Argentina’s economy minister, told journalists in New York, where he is pitching Argentina’s multi billion-dollar bond sale to investors, according to news media reports in Argentina. Prat-Gay, according to the reports, said Argentina would issue the bonds on Monday and Tuesday and that the holdout creditors would receive payment by Friday.

At: http://www.nytimes.com/2016/04/14/business/dealbook/court-opens-way-for-argentina-to-end-battle-with-hedge-funds.html?_r=0
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Singer no doubt had a word with these judges to make sure they don't get in the way of his 1,180% return. If only some of that could at least go toward reimbursing taxpayers for the $7 billion in TARP money he extorted from the U.S. Government in 2008.

[Travis_0004]

1. His profit is not 1,000%. Not even close to that

And tarp has been fully repaid, the government made a profit off TARP.

I dont see a problem with a debt holder wanting to be paid back.

Can I make a post here complaining if my mortgage company wants me to pay the loan I agreed to take out?

[forest444]

2. Except that's not what happened.

To begin with, that estimate is Joseph Stiglitz's, not mine. He's been following this case from the beginning.

As for Singer, his TARP heist has been extensively written about. He cashed in, used his control of Delphi Automotive to ship over half its jobs to China, and left Delphi to pay the TARP loan. The Romneys, btw, were among his partners in the hesit, and made up to $115 million in the deal.

Singer, btw, is a top GOP contributor, and was even known as the vulture who hatched Narco Rubio (Rubio, of course, lobbied quite a bit on Singer's behalf).

Now then, the bonds. Keep in mind that he bought old defaulted bonds in 2008 for $48 million from resellers (not Argentina). He didn't "want his money back" or even the market value of those bonds (around $200 million); he demanded close to a billion.

Later, in fact, he added to his Argentine holdings (to $177 million) and presented those as belonging to anonymous "me too" bondholders in order to buttress his case. Argentina's new offer (courtesy of their newly-elected GOP clone) would yield him nearly $2.3 trillion, or 1180% - plus, they pay all his legal costs.

As it happens though, Singer's already cashed in by way of the CDS default insurance he took out on these same bonds. That payout was granted in August 2014 (when his pet judge, Greasa, blocked Argentina from paying its own bondholders). Those legitimate bondholders had been collecting in full and on time since 2005 - and even made a sizable profit.

To use your analogy, it's as if you paid your mortgage, only to be told that a local judge put a hold in that check, and all future checks, until you either default on your mortgage or pay some criminal you don't even know an astronomical sum. Being a smart guy, you'd realize right away that the mystery individual wants your property without paying you for it; in fact, he even took out insurance on your property. Think Boss Hogg, if you remember the Dukes of Hazzard (basset hound optional).