Color of the Market Archive, Page #9
Color of the Market A R C H I V E 

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The Color of the Market has been an online meeting place for people interested in emerging market debt since 1996, and has undergone many changes in that time. We have discovered an old archive of Color of the Market messages, covering 5 months starting in late 1998. For the benefit of both old and new Bradynetters, we present this archive untouched.

Note: Back in these days, the forum software was greatly different than the Color of the Market that we are now accustomed to. Without the requirement of registration, the forum began to attract disrupters who would engage in vulgarities, name-calling, impersonation of users, and other childish hijinks. But if you can wade through the nonsense, some of the comments herein are historic, and prophetic.

Enjoy,
IDEAGlobal/BradyNet Staff

Wed Feb 17 10:07:48 EST 1999
Fox: MexCom, sorry to intrude. Paco, historically a 30% real devaluation in Brazil has produce enormous swings in the Country's Trade Account which turns around the C. Account. So, the answer lies on the inflation level, inspite of the fact that this may sound as a circular argument. Now, there is a very strong political argument to maintain inflation low, undoubtely President Cardoso won its mandate from price stability. My own forecast, for what is worth, '99 inflation 15%, exchange rate end of '99 1.75 max. 1.80.
Wed Feb 17 10:12:30 EST 1999
Fox: Good point optimistic, my questions actually go to the heart of thase credit ratings. I know we are all influenced by those ratings and we should be, but there is something on my mind I that bothers me very much; How could these guys get it so wrong in ASIA?
Wed Feb 17 10:15:48 EST 1999
Fox: Oh, last question optimistic. Can credit limits be based on the credit rating volatilty exposed in the Asian countries?
Wed Feb 17 10:33:40 EST 1999
optimist: oops, I guess thats the question to dedicated funds managers. Mr Mobius, for example. Actually I dont think that Poland is improper holder of investment grade rating. But in general your question refers to the uptitude of rating agencies. Yes they f....ed up recently and their actions are often irrelevant, but many funds are chartered to follow sp's or moody's ratings. what you think of that??
Wed Feb 17 10:53:38 EST 1999
Alexander: Great,this discussion!!! rgds.to you,friends
Wed Feb 17 10:55:20 EST 1999
Fox: Optimistic, don't get me wrong I do not think Poland has improper credit rating, it deserves its credit rating, and has done everything to earned it. It just that I still don't understand why credit ratings of Latins are so different to Asian or europeans. You must know that one of the few countries in the world that did not default during the interwar period was Argentina. Concerning the issue of utilizing credit ratings as the standard for credit limits, well, a lot of people including big instituionals are back to the drawing board. It is not only the credit agencies that went sour in Asia the entire credit system went under.
Wed Feb 17 10:57:13 EST 1999
Fox: Hey, Alex don't go, were is my WELCOME FOX and all the good part!!!!
Wed Feb 17 12:27:09 EST 1999
anonymous: Fox(y) is really Spanky trying to reestablish herself.
Wed Feb 17 12:33:17 EST 1999
Fox: No, no, Fox is Fox, for or bad.
Wed Feb 17 12:42:59 EST 1999
Alexander: I do not participate in personal remarks,unless I have to defend myself,if so,it will be "Yahoo!style".rgds.to all!
Wed Feb 17 13:52:46 EST 1999
Omar: One of the possible reasons for the lower credit ratings for Mexico is the lack of adecquate judicial guarantees. Laws are not applied equally and investors might find themselves in the wrong side when a dispute arises with a politically connected local business or institution.
Wed Feb 17 15:31:18 EST 1999
anonymous: braz c mar99 59.50 +25
Wed Feb 17 16:55:47 EST 1999
anonymous: "the best thing that could happen to Russian stocks would be the death of Yeltsin." (James Passin, american analyst)
Wed Feb 17 20:10:44 EST 1999
anonymous: Hello, GIRLS! Well, we are back where we started the year on She-Bonds, but its funny how y'all are sitting around stroking yourself cause you think you got it so right. Go figure!
Wed Feb 17 20:53:08 EST 1999
anonymous: To Anon: Only an american analyst can say such a horrible stupidity.
Thu Feb 18 01:45:44 EST 1999
anonymous: No ofendas a los Americanos amigo Anonimo, este ignorante tiene que ser de otra nacionalidad, fijate en sus faltas de ortografia y su enferma fjacion por el uso del genero femenino como ofensa...este es un simbolo de machismo, probablemente Latino ?.
Thu Feb 18 03:40:32 EST 1999
anonymous: <<Hello, GIRLS! Well, we are back where we started the year on She-Bonds, but its funny how y'all are sitting around stroking yourself cause you think you got it so right. Go figure!>> RIGHT HONEY BABY, YOU HAVE 6 WORKDAYS UNTIL END OF FEB99,WE HAVE NO PROBLEM,YOU HAVE,DARLING!LOSING $250.000.-IN 30 DAYS,GREAT
Thu Feb 18 07:04:42 EST 1999
anonymous: Argentina's Undersecretary of Financing Miguel Kiguel said on Thursday the country had $4.0 billion dollars of borrowing left to complete its 1999 funding programme on the international capital markets.
Thu Feb 18 09:07:11 EST 1999
Puma: Listen, they may need only 4B more (Argy) this year but they will keep issuing as much as they can and each time they can. Although they have been the best market timers I've seen this time araound they might be wrong(issuing each time they can and how they can and at whatever spread... ...as if the world were to end)
Thu Feb 18 11:16:56 EST 1999
Fox: Hi MexCom, how you like the Peso? A friend told that average real rates since the floating of the Peso in '95 have been 4%. This sounds ok to you? Rgds.
Thu Feb 18 12:02:15 EST 1999
Dyadya Venya: Russian Central banker quoted on Reuters saying that certain hard-currency payments will soon stop. Vague as to which ones. Also in FT today reported that Paris Club may insist on rescheduling of Euro-debt concurrent with P-club debt. This would give Russia this excuse it may be looking for,"Paris Club Made me Reschedule!" Just a heads up to you Russian Global bulls out there. Keep your fingers crossed about Pakistan/Paris club negotiations.
Thu Feb 18 12:16:57 EST 1999
Dyadya Venya: What will be the new name for Vnesh restructured loans?
Thu Feb 18 12:24:53 EST 1999
Alexander: Hi Dyadya,if they default on the Globals, what effect will this have on the RuR and their situation? rgds.
Thu Feb 18 12:40:02 EST 1999
Alex: wrong,its EUROs not GLOBALs,sorry.....
Thu Feb 18 12:40:26 EST 1999
anonymous: "but there was little sign that any of the reforms would be adopted soon" (FT, Pakistan may be warning for bond investors) The Economist/FT as Pearson products use this kind of stories to attract ...
Thu Feb 18 12:50:45 EST 1999
Dyadya Venya: Sorry Globals are Eurobond in terms of debt class. In terms of fundamentals for RU I dont see improvement until Rule of Law and or Commodity Price improve dramatically. That doesn't mean that these assets arent at great buying levels, I just mena that how long you have to wait to recognize value is determined by other factors. Russian FI positions are options on future bond positions. Oh yeah, the restructured Vnesh debt should be called,"The assets formerly known as Prins!"
Thu Feb 18 12:57:55 EST 1999
anonymous: RF 28 best buy at 15% on 10-9-98, did you buy?
Thu Feb 18 13:04:00 EST 1999
anonymous: The $100 K.. If Russia introduces an economic plan, with the IMF endorsement, and restructures all of its debt -- including Globals (which will at worst include 1 year of coupon payments paid with new globals) -- does the price of globals trade lower or higher? I bet is 10 percent higher. If Russia does get a Paris Club deal, it must be as part of a comprehensive economic program, including IMF, so Russia a better credit...Think about it, my friends.
Thu Feb 18 13:10:54 EST 1999
Dyadya Venya: Any Euro-rescheuling will be a VERY drawn out affair, I doubt for only one coupon period, 100% of bondholders are required to legally approve any ammendment. The lower approval hurdles req from the 1991 defaults took 5-6 years to iron out. Prices may trade up on the news of a fully comprehensive economic plan, but I wouldn't hold my breath. Low on RU28 was 13.5 intraday. Would it be better to buy prins at 8 an their way to 15-20 or hold Globals at 32 on their way to 42?
Thu Feb 18 13:17:46 EST 1999
anonymous: buying prins is not every banks fancy, you know.
Thu Feb 18 13:21:34 EST 1999
anonymous: Don't buy prins for the investment. Note, Prins are the obligation of Vneshnecom Bank.. The Russians will make London Club negotiate with V Bank for a workout and V Bank is broke. So, good chance Prins go to zero in a commercial workout. Note also comprable treatment does not mean default..
Thu Feb 18 13:44:17 EST 1999
Alexander: <<<RF 28 best buy at 15% on 10-9-98, did you buy?>>> I got them at 16.5, but I also have some Ukr for 84 :=)) :=))!! I would buy Rusfed28 at current levels too,I am waiting until they pay the 9%DM interest in March.rgds to all
Thu Feb 18 13:54:59 EST 1999
anonymous: "There is this entirely false idea that Eurobonds are senior to London Club debt and Paris Club debt, and that is priced into the market. But if the playing field is levelled, bondholders will demand compensation. Until now, the principle that all creditors should be treated equally has never been enforced and market convention has been to treat Eurobonds as a special class of debt. "
Thu Feb 18 14:01:20 EST 1999
Alexander: <<<Countries which are talking to the Paris Club about debt relief don't tend to be Eurobond borrowers...Pakistan aside, we're looking at places like Benin and Mozambique," he added.>>> how come,friend Anonym,that you only quote one little part of the story????
Thu Feb 18 15:42:37 EST 1999
anonymous: "If it bleeds, it leads". Rgds. Silvio
Thu Feb 18 16:06:54 EST 1999
anonymous: Had they read the entire article the last 2 remarks about EUROs and Mozambique,Benin etc. would have been found,but some people only read what the like to read,the rest is somehow brainfiltered away! rgds.Fayez
Thu Feb 18 17:16:32 EST 1999
unpourtous: While eurobonds are, technically speaking, treated pari pasu with other debt the practical effect, on a borrower, of defaulting on euros is much more severe than defaulting on paris or london club debt. Euros carry cross-default clauses which, to make a long story short, freeze a borrower out of eurobond markets until all arrears are remedied. BTW reuters comments quoted a BANKER. What would you expect him to say?
Thu Feb 18 17:43:22 EST 1999
anonymous: I read all these today's messages and I am as wise as I was before - to speak with Goethe's Faust. What is all this talking: Let's wait the next interest payment of Russian Eurobonds - I think at the end of March - and more then all other the date of May 14th, the real day of truth, and till then close the Bradynet down, since it can not bring much in the meantime, to discuss in the void. The only thing which interests are fact, hard facts and not opinions nor half stories somewhere copied...
Thu Feb 18 18:06:04 EST 1999
anonymous: Right!Facts! Please give some!
Thu Feb 18 19:18:29 EST 1999
unpourtous: anon: if you bring nothing to the table don't complain about the menu.
Thu Feb 18 19:55:49 EST 1999
unpourtous: Re Paris Club & euros: what are the chances that this is a backhanded attempt at coercing the imf into providing help? Commenta please.
Thu Feb 18 20:40:18 EST 1999
MW: To bring up another topic, does anyone know the collateral on the MYDFA Trust bonds due '07?
Thu Feb 18 21:12:44 EST 1999
anonymous: Was Poland buying own debt under 20's in 1990?
Thu Feb 18 22:54:53 EST 1999
anonymous: Russia ain't gonna default on Eurobonds. Pakistan may not. Paris Club only noise. Paris Club will be sued for "tortous interference" if they force they countries into default on bonds. Noise, noise, noise.. And all these arrogant bozo's complaining about this web site can ____ off!!
Thu Feb 18 22:56:59 EST 1999
anonymous: Nonsense, sovereign eurobonds are senior debt!
Fri Feb 19 01:55:13 EST 1999
wally: speaking strictly in legal terms: EUROs are n o t senior debt but rank in general 'pari pasu' with other debt. it is mainly the cross-default clause which makes the EUROs more secure and makes the debtor think very hard to reschedule/restructure any other debt before defaulting on a EURO. sorry gentlemen, i know this is hard to swallow, but it's a fact.
Fri Feb 19 02:57:38 EST 1999
anonymous: Wally, that by defintion would make it more senior. The eurobonds do not have sharing provisions.
Fri Feb 19 05:46:31 EST 1999
anonymous: In the case of Russia: The issue is not Paris Club debt versus Euros, but rather Soviet-era debt versus direct obligations of the Russian Federation.
Fri Feb 19 07:41:56 EST 1999
anonymous: << And all these arrogant bozo's complaining about this web site can ____ off!!>> thank you,is that all you can contribute,Mr.Intelligent???
Fri Feb 19 08:13:08 EST 1999
Puma: Euros, Princs... Who cares at this price princs are a long term option that some day they will pay you something. It is great buy even if there is a reestructuring with a forgivness of 50% (as russians want). Euros, don't hold any history may change and I do not think russians care as long as they can blame someone else (Paris club). Also think that this guys never understood the markets, which is the main reason why they may do something very stupid (they think they are a superpower still)
Fri Feb 19 08:19:07 EST 1999
wally: i beg to differ. russia is still a super power. as far as senior debt is concerned: one can argue about the definition of 'senior'.
Fri Feb 19 08:46:00 EST 1999
anonymous: I agree with Wally,deafult on RusFed EUROs is suicidal, especially in these times.They then can count on the next foreign credits in about 75yrs,after another mutation and under new name...:-))!!!!
Fri Feb 19 08:50:19 EST 1999
Puma: I would say that they are a nuclear power that can not pay its soldiers and has all the intelligence services working overtime so that they don't sell a nuclear bomb for a mercedes. I agree that Euros could be considered senior and that under some scenerios Euros may pay and Prins may not. But running a very simple model on a spreadsheet (asuming princs are an option) will tell you that their value is between 12 to 15. I suspect that Euro coupons will be considered a rip-off for them somewhere down the road (by a politician of course).
Fri Feb 19 08:55:55 EST 1999
Puma: My dear anonymous, sovereigns have defaulted in Eurobonds in the past and I do not see why they will not in the future. Market's memory is very short, specially because with the turnover that you have in EM in five years from now there will be a new generation of players (people and institutions). It is stupid for them to do so, I totally agree... ...but I am not sure that is what they think. If they think they are a superpower, they may think they can get away with it.
Fri Feb 19 09:04:17 EST 1999
anonymous: "remarks on Thursday by Mark Mobius, head of emerging markets at Templeton Investment Management, who said Russia would be 1999's best-performing emerging market. "
Fri Feb 19 09:36:03 EST 1999
Alexander: Puma has a point, look at the prices and you see the risk,we are talking about a partially default country.I still believe they know that NOT DEFAULTING on the EUROs is in their own interest. rgds.
Fri Feb 19 09:48:08 EST 1999
optimist: What ignited this discussion? Nobody was talking on euros default yet. Paris club stance on pakistan is not necessarily will be the same on russia. Coupon on euros in 1999 is ard 1.6 bio (10 pct of the reserves). If bears want to convince bulls to sell - its very natural, RF euros are VERY special on repo - one can borrow them at 4 pct only. Judging from this point of view let the bears sing their song and do the opposite. regards.
Fri Feb 19 10:10:52 EST 1999
Alex: Hi Opti,this discussion started yesteday (18Feb) following the article Paris Club targets Eurobonds,mentioning countries like Benin / Pakistan or Mozambique,so......
Fri Feb 19 10:14:00 EST 1999
Alex: http://www.berlinerboerse.de/KURSINFO/AKT_FV/FA2163.html 10%-15%up!! Not bad!
Fri Feb 19 10:31:20 EST 1999
JMC: Concerning the idea of Princ bonds as a long-term option on Russia. I may be mis-informed but wasn't there some Brazilian paper that is effectively worthless now but it experienced a bit of a spike 3-4 years ago on rumours that the new government was going to pay it off. When a country has as many financial obligations as Brazil, (or Russia), why should it return to service defaulted debt.
Fri Feb 19 10:39:19 EST 1999
coco: I have some Russia Ians. Do i have a loan or an eurobond ? What it will happen if they renegociate Princ.? do someone know what are russians trying to do ? thank you....
Fri Feb 19 11:05:02 EST 1999
anonymous: Russian oil company Sibneft paid $3.605 million in interest on a $150 million Eurobond due on August 15 2000 as scheduled on Thursday. JPC (no relation to Spanky as someone suggested)
Fri Feb 19 11:36:52 EST 1999
anonymous: jpc.......do u have any info on russias oil company tatnef..... eurobond to pay interest next april.
Fri Feb 19 11:46:20 EST 1999
anonymous: TATNEFT: http://quote.yahoo.com/q?s=TNT&d=t
Fri Feb 19 12:23:53 EST 1999
trawler: Bradynetters: Several interesting articles on the www.russiatoday web site regarding Russia/EU relations etc for anyone who may like to read them. Some are a bit contradictory in indicating where they may go.
Fri Feb 19 13:07:16 EST 1999
anonymous: Russia and Euroland getting closer is very positive. Also, a surprise announcement that Russians sending a top level delegation to the G7 this weekend. This is a positive. Signals that Russia now getting serious. Primikov learning the hard way the words of Maggie Thatcher "TINA" - "there is no alternative!!"
Fri Feb 19 13:08:46 EST 1999
anonymous: Luv ya, JPC
Fri Feb 19 14:15:35 EST 1999
anonymous: Ustedes no tengan miedo pero los borrachos pagan! Saludos a todos,Rodrigo Quiroga/Chile
Fri Feb 19 14:52:33 EST 1999
Fox: Hi, great discussion you all! First let me quote a gentleman and I will post my ideas on another message."A national bankruptcy is by no means illegal, and whether it is immoral or unwise depends altogether upon circumstances. One can hardly ask of the present generation that it alone shall suffer for the folly and waste of its predecessors, for otherwise in the end a country could hardly be inhabited because of the mass of its public debts.": Hugo, Lehrbuch des Naturrechts, Berlin, 1819. Dr. Primako has a PHD in political science; he is basically a strong political logical animal.
Fri Feb 19 15:04:02 EST 1999
Fox: Now, I know nothing about cross default an all that. But lets take a look at the situation. Why is everybody talking about Russian default? My answer: The dramatic collapse in the dollar value of GDP; ruble down about 70%, nominal GDP about the same as before deval. Thus, GDP '97: $ 450 bln, GDP '98: $315 and in '99 GDP? Probably a mere $ 150 bln. This perverse relationship of collapsing USD GDP and non rising nominal GDP leaves Russia with a External Debt/GDP of about: 170% of GDP. Good, we have now reached the conclusion that Russia's debt service is unsustainable. Conclusion on next message.
Fri Feb 19 15:05:01 EST 1999
anonymous: I'm trembling, Ralfie.
Fri Feb 19 15:19:07 EST 1999
Fox: We all know that presidential elections are in 2000, so does Primakov, and believe me he read Hugo. So, first things first. What type of debt Russia has? Basically two: Pre and Post 1991. A. London Club: IANS, Prins. B. MinFins: Tranches 3,3-5,6-7.C. Eurobonds. CONCLUSION: 1. Primakov has political ambitions that are growing by the minute. 2. He is a politically rational man. HE WILL DEFEND THE PAYMENT OF EUROBONDS WITH ALL HIS MIGHT, BECAUSE HE KNOWS THAT OTHERWISE RUSSIA IT IS NOT WORTHWHILE GOVERNING. Personally I think there is an 80% probability that Euros will be paid. I'am sorry if all this was boring. rgds.
Fri Feb 19 15:19:13 EST 1999
Omar: Nice quote Fox, but the date and the economic environment of the times has changed radically, at no time in history have nations been more economically interdependent as today. Also Russia and all other EM nations NEED foreign capital not just to pay old debts but to grow as well. As politically justifiable as anybody might make it sound, a nation that defaults on Euros would be isolated from the financial markets for a long long time.Regards
Fri Feb 19 15:24:29 EST 1999
Omar: Hello Fox, I guess my message was posted after you had completed your remarks, I was referring to Hugo's quote. Very good point about Primakov not wanting to govern an economically isolated Russia. Regards
Fri Feb 19 15:26:48 EST 1999
Fox: Omar, I agree with you 100%, it is just that I'am slow typing and my conclusion took longer than your response, which is absolutely correct! Really man, good point.
Fri Feb 19 16:44:40 EST 1999
Alex: They will not dare DEFAULTING on the EUROs,they know what's at stake for them,as for other debt..??????
Fri Feb 19 17:03:39 EST 1999
Fox: Well, I don't know. But what are the alternatives, like Omar said countries that default get out of the capital circuit. I think that the probabilities of Prins being paid are very small and you know I hold Prins. So, is the Fox finally gone mad? Not, really I'am not a member of the London Club, meaning that I bought my Prins around 8's. ALTERNATIVES: History tells us that Sovereigns repurchase debt when it falls substantially under par, and 7 or 8 seem quite under Par. But Russia has very little money so this is out. Other alternative, let's say Russia asks for forgiveness of part of the Pre '91 debt, a long negotiation will go on were London Club members will grant 50% reduction and Russia will say the market is 8%. CONCLUSION: Prins will not be paid shortly, but after the forgiveness they will be substantially above 8%. However, this restructuring can not happen before we have a new President so in the meantime we will get more paper be it IANS or any other sort of thing they can come up with. I'am making sense?
Fri Feb 19 17:19:48 EST 1999
Fox: S...t, I lost my last comment. It was something like this. History tells us that Sovereigns try to repurchase their the debt when it substantially falls under par, Prins at 8% seem reasonably under par. But Russia has very little money so this alternative is out. I don't think Prins will be paid any time soon, and you know that I hold Prins. Its the Fox mad? Not really, I'am not a London Club member; meaning I bought Prins around the 8% range. Russia will try to pay post-'91 debt and ask for forgiveness of the pre-'91 portion. London Club will offer a forgiveness of let's say 50% and Russia will say market it is 8%. This negotiation can only start the day we have a new President, in the meantime we will get something; IANS you know something. But I buy Prins because I believe that since Russia does not have the money to buy them back, the forgiveness will be less than 92%. Does it make sense?
Fri Feb 19 17:44:24 EST 1999
Alex: Makes sense! Which quote will be negotiated? How many years this will take? Also,count the interest lost compared to another,paying Bond! You simply have to wait....rgds.
Fri Feb 19 18:05:28 EST 1999
Fox: True, true, Prins are lousy bonds. Bullseye Alex, they are not Bonds they are options of Recovery Value.rgds
Fri Feb 19 22:46:37 EST 1999
Puma: Sorry, but it is late at night on friday and wanted to give you some gossip. Do you guys know that Russia has gotten at least two proposals that I know of, regarding a buyback on Princs with comodity based collateral? I do not know if something is being done or not. But we will find out soon...
Sat Feb 20 02:56:45 EST 1999
Alex: Commodity collateral? The only thing I heared of was Gold based Bonds. So many rumors and talk,I liked to see $$$s instead of words, wouldn't you too,friends??? have a good weekend
Sat Feb 20 05:50:29 EST 1999
Fox: How much money were are talking about? What is the market value of Prins?
Sat Feb 20 09:05:35 EST 1999
El Oraculo: Soviet Union does not exist - why would Russia want to use a Commodity backed isue and use these scarce USD to buy back PRINCS ?? They already defaulted, why go back... sorry PRIN holders (and IAN holders)... you are not going to get 0.01 cent !!! Maybe some barter for some LAND in SIBERIA>>>>
Sat Feb 20 09:06:12 EST 1999
Puma: Fox, that is a great point because we are talking about 1.7B at this market prices. Someone mentioned yesterday that he/she didn't know where all the issue between Euros vs other debt was coming from. Very simple, Russia is asking the Paris club for some debt forgivness, and the Paris club will agree but they will demand equal treatment for all the debt holders. It is a standard demand from the Paris club, but they have not been sucessful with it in the past. Although this time around they are more serious.
Sat Feb 20 10:38:03 EST 1999
wally: buying back PRINs at present market prices is pure fiction. even a 10-20% demand would drive prices up into the twenties; not to mention if anybody would be interested to buy the whole lot.
Sat Feb 20 12:04:54 EST 1999
anonymous: I agree with Wally. It'll take ages to buy back prins WITHOUT ROCKETING THE PRICE.Supply is so small!!
Sat Feb 20 13:27:40 EST 1999
anonymous: El Oraculo has said it a little "undiplomatic", but he is basically right! We are dealing with people who have other measures for business and financial relationships than the WEST!!!!! They see the investors as a bunch of a*****holes who can be treated like idiots, BECAUSE the Russians think the WORLD OWES THEM!! Careful!! The only Bonds that one can buy are EUROs, and also not too many at a time,for IANs and PRINs and other defaulted (ex)Bonds, you have to wait even 5 years or more!!!saludos Rodrigo
Sat Feb 20 15:11:23 EST 1999
Fox: Hi, Yes and no to all of you. Yes all creditors should be treated equally, particularly when we talking about the same debtor (Soviet Union is not Russian Federation). Paris, London Club, Euros this must be put in the perspective of Pre/Post '91 Debt. Yes, as Puma noted the market value of Prins is ridiculous, what a temptation to get rid of the problem. Yes Wally, very difficult to buy the stuff at 8%, 10%, 20% or 35% this and the lack of money makes a negotiated forgiveness best alternative. Oraculo, why bother, well, a country's first wish after they default is to get credit again, after all nobody defaults because you are directing cash from foreigners to public works. Russia has no money end of story. Paris Club asking for equal treatment, well, they can ask whatever they want, what matters for Russia is IMF and private capital. IMF has agreed to assit countries in arrears if they follow sound policy and Private capital has suffer enough with GKOs. You know Paris and London Club are like the Bondholders' associations of the 19th century they accepted the unilateral offer of the debtors.rgds
Sat Feb 20 16:20:52 EST 1999
wally: i consider it unfair to use the word russians instead of RUSSIA as i am sure that the average russian did not benefit from cheating (us) investors.
Sat Feb 20 17:07:20 EST 1999
anonymous: Are you stupid? Prins will never be bought back by the MinFin. Prins are the obligation of Vneshnecom bank, not the ministry of finance. Russia does not recoginize the debt. Get it? What is the liquidation value of V. Bank and we can get a fair value on the prins. Stay focused on the direct obligations of the Ministry of Finance..
Sat Feb 20 17:15:57 EST 1999
Puma: A buyback is matter of price. Would they buy everything at 1 if they had the chance? The answer is yes. So at some price they are buyers and that is a fact. Supply has not been that small. Consider the position liquidated by a German bank's back book over the last three months. In any case remember Peru in the early '90s. They were in a distressed situation and bought some paper. Another idea: Debt Swaps... Do you know how many billions are owed to Russia from arm sales? India alone owed them several billions a few years ago (last time I checked) Another: De Beer could pay diamonds with debt. In any case... ...don't be wrong be long Prins... Have a nice weekend.
Sat Feb 20 18:11:16 EST 1999
Alex: Hi Wally,I had some russian students on visit last week,if these kids will run the Russian Federation one day,everything will be ok. About investing,I would (and will) buy RusFed ONLY! PRINs and IANs or other for speculation! Not too many of each! rgds.
Sat Feb 20 22:16:59 EST 1999
Puma: Dear anonymous, don't get personal... I think that BradyNet should not let someone using such a language to be part of a gentleman's dialogue.
Sun Feb 21 02:20:31 EST 1999
wally: puma: a debt swap is basically a good idea. india is still owing them a lot of money from former arms deliveries. part of it has been balanced by delivering grain from india. apart from that: india announced the purchase of parts to assemble 300 russian T90 tanks. the lion share of russian receivables are blocked in iraq. that is one of the reasons russia would like to have the sanctions lifted. there is a couple of billions still due to russia from countries which are not able to pay (angola and mozambique,cuba and a few others).
Sun Feb 21 09:26:12 EST 1999
Fox: The issue of recognizing debt or not is subjective. Getting free of arrears be it Sovereign,Cuasisov., or Supra National has an important element of reputational nature. This in turn is related to the availability of credit the debtor envisions in obtaining in the not so far future. Conclusion, if the credit cycle is recompose the incentive of being free of all arrears is very high, on the other hand if credit crunch continues and or intensifies there is very little incentive to solve arrears. Worthwhile reading G7 communique. rgds. By the way, we may all say things that can reveal our ignorance, nothing wrong with that, we are participating in this discusions to help each other increase our understanding of these things. Lack of respect of each other, is absolutely unacceptable. Lets treat each other with the highest rescpect Gentlemen deserve, Thank You All!!
Sun Feb 21 13:25:27 EST 1999
anonymous: For Fox and Puma: I agree 100%: Dont'get personal. As says Fox absolutely correct: We are here to give ideas we have, to give news we have, to give opinions we have. But not to comment on other's ideas if not in a very objectif and gentleman's like way. By the way: PRINS: I personally do not know anything about them and I do not really understand what is the difference with others (MinFin's f.i.) a.s.o., but after my bank, one of the biggest of the world, recommended to buy them for 6%, every day for two months, I bought some of them at 6.5%. And I wait. One more thing: After reading daily the News of "Russia Today" Website, I get the longer the more the impression: 1st the Russians - Mr. Primakow - plays a kind of game with the west. Every day another news about the same thing, and 2nd: They will pay in all means, even MinFin 3 on the 14th of May, because they are Russians, pride to be it, and they want not to loose their face. But they play around with the IMF, they let them come and let them go, and discuss and discuss, and in the meantime they pay. One Minister said the other day, Russia cannot do all too much for getting the funds of the IMF, but also without more money of the IMF they are prepared to pay their debt. All that just a personal impression. In any way, it would be worthwhile to write a book about what all was said by Russian Ministers in the six months since august 98.
Sun Feb 21 13:49:26 EST 1999
Cheetah: Stay focused !! If Veneshcom Bank is BROKE - it's BROKE ! They have already defaulted on Princ's, next will be IAN's, anything else is WISHFULL thinking... commodity backed, swaps, buybacks, Indian arms deals... Give us a break ?!@#&% Just say bye bye... change your focus to the Russian Euro's !! El Oraculo is always right !
Sun Feb 21 14:10:49 EST 1999
anonymous: and Spanky... you only have a few days left, how are you going to make back to all your fellow shorts that followed your instructions ???
Sun Feb 21 16:04:32 EST 1999
anonymous: I wonder if we ever hear again from SPANKY... at least by this name. R.I.P.
Sun Feb 21 16:31:50 EST 1999
Omar: Puma and Fox have a very good point about the value of PRINs and IANs being determined by the value that Russia places on enhancing their credit reputation. Aside from technical or legal considerations (Soviet debt, not MinFin debt, etc.) just about everybody knows that Russia is ultimately responsible for these instruments and will hold their ability to get further credit until they work out a reasonable solution.Greetings and a good weekend for all.
Sun Feb 21 18:05:26 EST 1999
Cheetah: It is a mistake to think that RUSSIA's credit credit improves by "treating" prin and IAN holders "well". VNESCOM Bank is BROKE - zero, zerapio, zilch - ain't going to pay !!! Now the RUSSIAN Euros - that IS different and that is where investors must FOCUS.
Sun Feb 21 21:06:03 EST 1999
Puma: Going back to the issue of treating all the debt in equal terms as Paris Club demands, I think that at the end of the day they will waive it just because otherwise it will get more expensive for all the countries to issue Euros. On top of that they could create a bigger credit crunch than the one in place now for EM. And I don't think that anybody wants to be blamed for that. Hope to continue this interesting discussion on Monday. Best regards to all.
Sun Feb 21 22:08:08 EST 1999
anonymous: Spanky darling, only this week left, I don't like to claim anything before it's time, but I do believe I am closer to going to St. Barth's in march than She-bonds with a 30 handle... or Veni DCB's with 40 handle...
Sun Feb 21 23:40:41 EST 1999
Omar: How can the Paris Club force a country to "default/restructure" Euros, other than by refusing to restructure Paris Club debt ?, are there cross default provisions in this debt as they are in Euros ?, what would happen if a country decides to default/resturcture Paris Club but continues servicing Euros ala Russia with PRINs and IAN's ?. Saludos
Sun Feb 21 23:48:07 EST 1999
Omar: Sorry, I forgot to add to my last message another question: Aren't most Paris Club loans made essentially for political reasons and thus also subject to political restructuring as opposed to Euros which represent basically an economic motive ?. All replies welcome, thanks.
Mon Feb 22 00:01:26 EST 1999
anonymous: C'mon Omar you just saw it happen in Russia
Mon Feb 22 03:07:32 EST 1999
anonymous: Pakistan is about to default on euro.Russia,Ukraine,Venezuela etc will follow suit.The euro bonanza is coming to an end.
Mon Feb 22 03:13:54 EST 1999
optimist: GM to all. Should be of some interest to bradynetters: Mr Primakov on saturday said commenting on the meeting in Bonn that "negotiations with IMF will be a success, we count on that". What gentlemen think on possible tensions after Kosovo deadline is over? The situation in russia now very supportive for serbs. That is - Army top brass say that Russia will be compelled to re-establish relations with NATO on different principles, if Serbs are hit. I read hidden threat in this comment. rgds.
Mon Feb 22 03:43:16 EST 1999
anonymous: See www.bloomberg.com/sa/sahome.html for PAKISTAN and sovereign EUROS'future
Mon Feb 22 05:26:23 EST 1999
PILLX: There are no clear rules for restructuring debt that has been defaulted on twice. Also, the holders of the restructured Soviet-era debt are more dispersed than they were in 1991. The London Club agreement converted the outstanding debt into bonds that traded actively on international markets. Today, the holders of those restructured notes are spread around the globe.The variety of instruments, obligors and potential legal nuances could make the Federation's default one of the most interesting of the past decade.
Mon Feb 22 05:29:11 EST 1999
anonymous: "hidden threat" - what else do you expect diplomatical warriors to do, Optimist? Best rgds. Spadolini
Mon Feb 22 05:34:23 EST 1999
anonymous: TO PILLX:Do you think Pakistan will default on EUROS?
Mon Feb 22 05:34:58 EST 1999
PILLX: Western creditors might be willing to offer some debt forgiveness if Russia will stop trying to distance itself from the Soviet-era debt. In a second restructuring of the Paris and London Club debts, for example, creditors could demand that Soviet debt be transferred from Vnesheconombank to the government itself. Creditors might also demand that Russia agree that another default on the Soviet-era debt would trigger simultaneous defaults in the other, more recently issued classes of Russian debt.
Mon Feb 22 05:40:37 EST 1999
optimist: Russia has vehicles to rule Serbs behaviour - gas& light. If russia doesnt use them - she doesnt want to . So Russia is following the course of increasing tensions. I think if genius in Rambullier stop using NATO for "pease maiking" mission and turn to european (OSCE)mechanisms, Russia will reason with Serbs. But deadline too close. Pity.
Mon Feb 22 09:33:46 EST 1999
anonymous: President Yeltsin has signed the budget 1999 today. The Russian Budget for 1999 is now accepted by all instances and became law. The Russians go slowly but clearly their constitutional way. The G7, the IMF, the World Bank, Mr. Schroeder and the rest, all say, make another budget. But the Russians very politely - say, we have one. Don't you have - like me - sometimes the impression that the Russians are clearly knowing what they are doing, have a clear idea, and are not even that much interested in aid from outside. Don't ask me why and how they do that, but I got this impression since a certain time. The only thing r e a l we have seen: the Russians paid since august 1998 all interest payments in time and correctly on Eurobonds. So let us wait what will happen on the end of march when the next coupons have to be paid. Personnally, I do not doubt at all that they will continue to pay, even on the 14th of May.
Mon Feb 22 09:45:07 EST 1999
Cheeetah: I agree SINNOMBRE, if you buy a credit (VNESHCONOBANK) and it goes broke, thats it, you lose ! And if the whole republic changes - WHY DO THE HAVE TO PICK UP THE PIECES ? and in detriment of their citizens ... FORGET the IAN's and PRIN's they are worth the difference between ASSETS and LIABILITIES at VNESHCONOBANK !!! to the default Anony get a name and do your numbers (specially on Venezuela)
Mon Feb 22 12:21:37 EST 1999
anonymous: Russian Stocks up 7.38% today, trading volume: US$ 12.07 Mio. The rally is now going on for more than two weeks. For me it is a good sign.
Mon Feb 22 13:12:31 EST 1999
anonymous: The West should forgive Russia part of its Soviet-era debt to lift the country out of economic doldrums, Mikhail Gorbachev, who took out billions of dollars in loans as Soviet president, said in an interview on Monday.
Mon Feb 22 13:29:02 EST 1999
anonymous: How about giving back all those weapons built by the Soviets in exchange for forgiveness ?
Mon Feb 22 14:07:17 EST 1999
Fox: Hi, Annonymous (pls. get a shorter name), you said something like, "Yeltsin signed the budget for '99.... everyone is pressing Russia but they don't seem to get nervous.... Well, here is something to add to this mysterious situation. The State Statistics Committee revealed that, the trade surplus increased to $3.5 bln. in 12/98 from $2.9 bln. in 11/98. Exports dropped about 22% YoY, while imports collapsed 56% YoY (in dollar terms). The Dec. figure is probably the largest monthly surplus in the '90's. Question: Were are the reserves?
Mon Feb 22 14:10:29 EST 1999
anonymous: Simple:the reserves are used to stabilise the ruble at around 22.5.cbr.
Mon Feb 22 14:15:42 EST 1999
anonymous: Fox:YOU KNOW THAT RESERVES CAN BE SPENT BUYING ROUBLES AND SELLING HARD CURRENCY?DON'T BE SO INGENUOS.
Mon Feb 22 14:17:10 EST 1999
anonymous: Fox:YOU KNOW THAT RESERVES CAN BE SPENT BUYING ROUBLES AND SELLING HARD CURRENCY?DON'T BE SO INGENUOS.
Mon Feb 22 14:19:17 EST 1999
Fox: Hey, Cheetah nice e-mail address! Hey, Puma you better check Cheetah's e-mail.! Now, to business. Annonymous, could be and maybe your are right concerning Russia's reserves. I was thinking more on the lines that Exporters have 180 days to repatriate proceeds and they are delaying as long as they can, and that capital flight is probably still quite high.
Mon Feb 22 14:24:36 EST 1999
Fox: Yes, of course, but doesn't the Central Bank must have the reserves first? That's why I'am more inclined to believe that delays in repatriation and capital flight are preventing reserves to rise. Or FIMACO is getting bigger?
Mon Feb 22 14:24:48 EST 1999
Fox: Yes, of course, but doesn't the Central Bank must have the reserves first? That's why I'am more inclined to believe that delays in repatriation and capital flight are preventing reserves to rise. Or FIMACO is getting bigger?
Mon Feb 22 14:38:09 EST 1999
anonymous: Certainly something is getting bigger maybe not FIMACO but RISACO.They have had plenty of time to build another offshore company to manage reserves.What threats me is that reserves are diminishing and Zadornov said that they havent used them for debts repayments.You then have a choice:they are hiding them or they are supporting the ruble?
Mon Feb 22 15:14:25 EST 1999
PILLX: The Russian central bank's foreign exchange and gold reserves fell by $300 million in the second week of February to a total of $11.3 billion. In January alone, the central bank paid $320 million from its reserves to cover interest payments on the government's outstanding Eurobonds.The government has no sovereign debt payments to make in February, but it has to pay $2 billion on its foreign debt in March through May.The central bank has been trying to boost its reserves by imposing strict currency regulations, including the mandatory repatriation of foreign exchange revenues of Russian exporters.But the central bank's measures for preventing capital flight out of Russia are still porous,funds are leaving the country disguised as import contracts,capital flight in the form of unsanctioned operations is one of the weak points.The central bank requires Russian exporters and importers to sell and buy foreign currencies at designated currency auctions, which are strictly controlled by the bank.However, the bank's officials have repeatedly admitted that the policy hasn't prevented banks from using fake import contracts to allow hard currency to leave Russia.The central bank is using different ways to stop it; however the people's inventiveness has no limits and each new regulation gives birth to a new invention.
Mon Feb 22 15:16:10 EST 1999
PILLX: The Russian central bank's foreign exchange and gold reserves fell by $300 million in the second week of February to a total of $11.3 billion.In January alone,they paid $320 million from its reserves to cover interest payments on the government's outstanding Eurobonds.The government has no sovereign debt payments to make in February, but it has to pay $2 billion on its foreign debt in March through May.The central bank has been trying to boost its reserves by imposing strict currency regulations, including the mandatory repatriation of foreign exchange revenues of Russian exporters.But the central bank's measures for preventing capital flight out of Russia are still porous,funds are leaving the country disguised as import contracts,capital flight in the form of unsanctioned operations is one of the weak points.The central bank requires Russian exporters and importers to sell and buy foreign currencies at designated currency auctions, which are strictly controlled by the bank.However, the bank's officials have repeatedly admitted that the policy hasn't prevented banks from using fake import contracts to allow hard currency to leave Russia.The central bank is using different ways to stop it; however the people's inventiveness has no limits and each new regulation gives birth to a new invention.
Mon Feb 22 15:17:26 EST 1999
PILLX: The Russian central bank's foreign exchange and gold reserves fell by $300 million in the second week of February to a total of $11.3 billion.In January alone,they paid $320 million from its reserves to cover interest payments on the government's outstanding Eurobonds.The government has no sovereign debt payments to make in February, but it has to pay $2 billion on its foreign debt in March through May.The central bank has been trying to boost its reserves by imposing strict currency regulations, including the mandatory repatriation of foreign exchange revenues of Russian exporters.But the central bank's measures for preventing capital flight out of Russia are still porous,funds are leaving the country disguised as import contracts,capital flight in the form of unsanctioned operations is one of the weak points.The central bank requires Russian exporters and importers to sell and buy foreign currencies at designated currency auctions,which are strictly controlled by the bank.However,the bank's officials have repeatedly admitted that the policy hasn't prevented banks from using fake import contracts to allow hard currency to leave Russia.The central bank is using different ways to stop it,however the people's inventiveness has no limits and each new regulation gives birth to a new invention.
Mon Feb 22 15:18:48 EST 1999
PILLX: The Russian central bank's foreign exchange and gold reserves fell by $300 million in the second week of February to a total of $11.3 billion.In January alone,they paid $320 million from its reserves to cover interest payments on the government's outstanding Eurobonds.The government has no sovereign debt payments to make in February, but it has to pay $2 billion on its foreign debt in March through May.
Mon Feb 22 15:18:59 EST 1999
PILLX: The central bank has been trying to boost its reserves by imposing strict currency regulations, including the mandatory repatriation of foreign exchange revenues of Russian exporters.But the central bank's measures for preventing capital flight out of Russia are still porous,funds are leaving the country disguised as import contracts,capital flight in the form of unsanctioned operations is one of the weak points.The central bank requires Russian exporters and importers to sell and buy foreign currencies at designated currency auctions,which are strictly controlled by the bank.However,the bank's officials have repeatedly admitted that the policy hasn't prevented banks from using fake import contracts to allow hard currency to leave Russia.The central bank is using different ways to stop it,however the people's inventiveness has no limits and each new regulation gives birth to a new invention.
Mon Feb 22 16:53:23 EST 1999
unpourtous: So gentlemen: we have a potential catfight between RF creditors, diminishing RCB reserves, the IMF insisting on a new budget, which the russians say is impossible. Where is this all going and is it time to buy sell or hold russian debt? Comments appreciated.
Mon Feb 22 19:36:44 EST 1999
anonymous: Guess it's a cost-benefit analysis on the cost of legal fees on lawsuits versus the benefits of defaulting on euros. The Russian know it, and fear it...
Mon Feb 22 22:23:45 EST 1999
anonymous: The Brazilean Governor of the State of Pirapapeo has declared a moratorium !!
Mon Feb 22 22:31:42 EST 1999
Omar: Hello unpourtous - In my opinion, if you've already have Russian Euros, PRIN's or IAN's I'd say HOLD, I think we'll experience a lot of volatility but don't see a big downside in these instruments. If you don't have any Euros I'd say BUY some, I like the high yields and believe that the Russians won't default on Euros. I wouldn't use any leverage to be able to hold under fire and wouldn't buy any PRIN's or IAN's, I don't like options. Greeetings
Mon Feb 22 22:33:45 EST 1999
anonymous: So what else is new !!!, another puppet governor declaring moratorium,it's a big joke...they'll just cut their funds from the Federal Gocernment...
Tue Feb 23 01:05:10 EST 1999
anonymous: Hey Cheat-DAH: Chase saying Venezuela may default on DCBs in its latest research report. Go figure, Cheat-DAH!! Luv ya, Spanlin D. CBs.....
Tue Feb 23 05:46:31 EST 1999
anonymous: Pakistan,Ukraine,Russia,Venezuela,Equador will all default on euros.This is one of the last chance to sell everything.
Tue Feb 23 06:01:09 EST 1999
anonymous: Spanky will default too on friday
Tue Feb 23 08:27:55 EST 1999
Tedy: What about Bulgarian IAB and ZUNK s bounds ? To buy or not?Who ill say me ?
Tue Feb 23 12:44:01 EST 1999
anonymous: <<Pakistan,Ukraine,Russia,Venezuela,Equador will all default on euros.This is one of the last chance to sell everything.>> ALL opinions WITHOUT rationale are worthless.
Tue Feb 23 14:40:45 EST 1999
anonymous: I still don't think any sovereign will default on euros.At the firs of such default people would rush away from emerging market debts and won't buy any for the next 10 years.I don't think IMF EUROPE AND USA WANT SUCH AN OUTCOME.It'll be like committing suicide.The socalled process of globalisation will go back to the 70's
Tue Feb 23 14:44:56 EST 1999
anonymous: ecudor par performed well yestrday. how about today. is there any volume in trading?
Tue Feb 23 14:53:34 EST 1999
anonymous: All sell rec's are without rationale??
Tue Feb 23 14:54:39 EST 1999
anonymous: All sell rec's are without rationale??
Tue Feb 23 14:55:12 EST 1999
anonymous: All sell rec's are without rationale??
Tue Feb 23 14:56:39 EST 1999
anonymous: All sell rec's are without rationale??
Tue Feb 23 15:27:38 EST 1999
Silvio: you want to be taken seriously? Get baptized! Where to turn to if you are wrong?
Tue Feb 23 19:01:19 EST 1999
Daniel: <<Anonymous: All sell rec's are without rationale??>> A glass of water and pressing RELOAD will cure those hiccups. (I bet you're the kind who presses elevator buttons 17 times aren't you?)
Tue Feb 23 21:25:40 EST 1999
Cheetah: Hey Spankgirl, when has CHASE been right ??? Did they foresee Asia, Rusia, Brasil, oil prices, Internet stocks ?? Sure anyone "may" default -- even Greenspan talked today of a possible USA default on treasuries -- SO ??? I invite you, darling, to "figure" and do your numbers: Assets - Liabilities for Veni, of course in your case as of friday Liabilities >>>> Assets >>>> Credibility
Tue Feb 23 22:40:02 EST 1999
anonymous: Figure ?, Think ?, That'd be too much for Spanky or any of his aliases, their specialty: panicky opinions without substantiation
Wed Feb 24 01:58:05 EST 1999
anonymous: Cheat-DAH: Can you spell, P-O-L-I-T-I-C-S??? Also check out Wednesday cover story on Washington Post about Y2K.. Sez Venezuela and other Emerging Markets in Deep do-do.. Capital flight, panic, and trade disruptions coming.. Hey, but party on, Cheat-DAH. Don't worry, be happy!!
Wed Feb 24 02:51:53 EST 1999
Silvio: which gold stocks do you prefer? Get a name for your own discipline.
Wed Feb 24 09:46:06 EST 1999
Cheetah: The only Deep do do I see is your margin call !! So much bad news, Pakistan, Real > 2.00, Verdepan overvaluations... and She-bonds stable, Veni going UP, glad to be LONG and coupon clipping !!! Salud my darling
Wed Feb 24 09:56:03 EST 1999
anonymous: i used to know some coupon clipping guys. now they are in a trip all around europe trying to discover the meaning of life
Wed Feb 24 09:56:46 EST 1999
anonymous: i used to know some coupon clipping guys. now they are in a trip all around europe trying to discover the meaning of life
Wed Feb 24 10:10:33 EST 1999
anonymous: lol, good one
Wed Feb 24 10:10:43 EST 1999
anonymous: lol, good one
Wed Feb 24 15:02:01 EST 1999
MexCom: The Peso closed at 9.94 per dollar Tuesday (February 23) only 4 centavos below last week. It continues to be sought by international investors. It could have been stronger because Brazil lowered its overnight interest rates unsteadying Latin American markets. Interest rates continued to decline at the weekly cetes (Mexican treasury bills) auction. The 28-day notes yielded 26.71 percent (down 0.29 percent from last week) and the 91-day notes yielded 27.07 percent (down 0.63 percent.) A 168-day maturity yielded 26.86 percent. Interest rates have declined steadily now for five weeks. Last week’s financial performance on the Mexican Bolsa (stock market) with a 2.4 percent surge took it to its highest level since November 9. Positive gross domestic product and deficit numbers with increased confidence that the government will meet its 13 percent inflation target stimulated investors to buy Mexican stocks.
Wed Feb 24 15:04:41 EST 1999
MexCom: The Bank of Mexico continues to loosen monetary policy. Despite additional lowering of interest rates the peso continues to show strength. Our analysis last week predicting continuation of the strong Mexican financial rally came through. Bidding was not as aggressive at this week’s cetes auction compared to the previous week but the long-term maturity is still yielding slightly lower than the 91-day note indicating interest rates may have further to go on the downside. As these rates keep declining, the incentive for international investors to buy pesos for Mexican investments decreases. But, the current returns are more than double of what can be obtained from U.S. Treasury bills. This financial rally may continue a bit longer but the peso will become more susceptible for a decline. With the surge in the stock market, international capital flows are again returning to Mexico.
Wed Feb 24 15:15:47 EST 1999
anonymous: Mexico enthusiasts BEWARE, we've seen this movie played before (remember 1994 ?), nothing has changed the government is still incredibly corrupt, labor laws that would make Fidel Castro proud, politicians that favor their local business buddies and a Presidential election coming next year. Can anybody remember Mexico's outlok in 1993 under Mr.Zedillo's old boss (Salinas) ?, it looked even better than today's !!!. Mexico's economy revolves around the politics of their Presidential cycle and this is the year when "things beginning to look good" just before the next devaluation, scheduled for sometime next year.
Wed Feb 24 15:19:51 EST 1999
anonymous: UMS have been very stable...much better bet on Mexico, not subject to local currency/policies
Wed Feb 24 18:58:04 EST 1999
Cheeetah: It's great to be able to discover the meaning of life - be with your family - travel all around europe... just by coupon clipping !! If you are Short, my darling, you need that screen... o and of course prices to go down... I will discover the meaning of food on St. Barths while you try to spread disaster over the Bradynet >>> Ciao
Thu Feb 25 02:32:19 EST 1999
Cciano: Yes Cheetah, there are only a few good things in life to enjoy, one of these surely is 2 digit yield coupon clipping. btw, Spanky breaks on friday.
Thu Feb 25 05:34:10 EST 1999
optimist: Further to their CreditWeek article, S&P is holding a teleconference tomorrow on the credit implications of the possibly precedent-setting decision by the Paris Club in its rescheduling agreement with Pakistan to apply its "comparability of treatment" principle to sovereign bonds. As S&P puts it, this could remove a "layer of protection" enjoyed by sovereign bondholders with the loss of their favored position vis-a-vis commercial banks. The conference call will be held on Thursday, 25 February at 16:00 GMT (11:00 am US Eastern Time)
Thu Feb 25 09:38:51 EST 1999
Puma: I think that at the end of the day Paris Club will come to the conclusion that if they insist with this comparability issue they might be responsible for the next round of turmoil... ...and I don't think that is what they want... ...otherwise which is the purpose of a Paris Club reestructuring. By the way the article is short sighted and has value only because of the historical information on it... ...like the fact that the first Paris Club meeting was held in 1956... ...for... ...guess who?
Thu Feb 25 09:48:09 EST 1999
Puma: Has someone seen the article in the NYT about Argentina and the possibility of a full dollarization? The issue is not new, but it is important to point out that the american public is getting into the issue as it will need to be approved by the president at the end of the day. Something import is the fact that the Fed is the "de facto" Central Bank of Latin America and now they are realizing that it would be better to be the "de jure" CB. Any thoughts?
Thu Feb 25 09:59:11 EST 1999
JMC: On CNBC this morning one of the analysts said that Greenspan was essentially negative about dolarization of LatAm countries as the Fed did not want to be viewed as a "lender of last resort". This sounds reasonable enough to me.
Thu Feb 25 11:30:25 EST 1999
Daniel: The Fed is not the lender of last resort; that's the job of the IMF!
Thu Feb 25 13:11:08 EST 1999
Omar: The Fed doesn't have much choice but to become LatAm Central Bank if the US wants to have a competitive trading block like Euroland, whether Mr.Greespan wants it or not, as Puma says the Fed IS the "de facto" Central Bank in Latin America.
Thu Feb 25 15:04:11 EST 1999
anonymous: The FED THE DEFACTO CENTRAL BANK FOR LATIN AMERICA? Tell that to Mexico in 1994/95 when Greenie kept raising rates in the midst of the crisis. What the _____ are you guyz smoking?
Thu Feb 25 15:05:41 EST 1999
anonymous: Why would Greenspan want to tie his hands with a bunch of deadbeat debtors?
Thu Feb 25 15:07:44 EST 1999
anonymous: Cheetah: How can I short you?
Thu Feb 25 15:14:02 EST 1999
anonymous: Hallo Ralf,wie geht's? Was gibt's neues?
Thu Feb 25 15:29:43 EST 1999
anonymous: i sold all EM bonds as anonymous told me. where to put the uncle suckers in now?
Thu Feb 25 16:01:27 EST 1999
anonymous: Pump and Dump, Girls... Pump and Dump...
Thu Feb 25 16:06:45 EST 1999
anonymous: russia strong, rumor of buyback
Thu Feb 25 16:20:40 EST 1999
anonymous: anonymous, rotten swine, i expect any rec where to put the $$ in you told me to draw out of EM bonds. where is your praised resposibility?
Thu Feb 25 16:29:42 EST 1999
Alexander: are you crazy or what?? We try to keep this site correct,if you like vulgarities so to YAHOO!
Thu Feb 25 16:30:21 EST 1999
wally: russia strong? buyback? prices of all russian bonds down 1/2-1 point! (gmt 22.00).
Thu Feb 25 16:38:31 EST 1999
Alex: I have to say it again,only 2 are strong,the 38%Moskovskaya and the 44%Stolychnaya,rgds.
Thu Feb 25 17:47:41 EST 1999
anonymous: Rotten swine?? Man, sounds like you have one bad position in your book. Can I hold your hand and help you sell?
Thu Feb 25 17:47:47 EST 1999
anonymous: Tomorrow, friday 26th, dedicated to Spanky and all her aliases: C bond at 30? What a horny prophet-girl when she's on her knees...
Thu Feb 25 17:51:09 EST 1999
anonymous: I said you would loose 30K on you she-bonds.. didn't I? Hey maybe my timing was off, o.k.?
Thu Feb 25 22:57:28 EST 1999
Omar: Fellow Anonymous: neither Greenspan's approval/opinion nor anybody else's, are required for the Fed to be the "de facto" Central Bank for Latin America, "de facto" means "as a matter of fact" or "consumated fact".
Thu Feb 25 23:57:32 EST 1999
anonymous: Omar: If you think Greenspan gives a --it about Latin America, I feel sorry for you. Latin America is to be used and abused for the American interests. Don't kid yourself, if the 3 easings to bail out the emerging markets risks overheating the U.S., then he will tighten. Isn't it funny how the U.S. has exported its boom bust cycle to the emerging markets? How long is that politically sustainable? Emerging markets recieve excess liquidity, which used to cause inflationary pressures in the U.S... and when the U.S. needs the liquidity back, emerging markets are caught with their pants down! Go figure, Omar! Does that sound like goldilocks and a sustainable world?
Fri Feb 26 01:37:31 EST 1999
Alex: <<02-25-99 Anonymous: Rotten swine?? Man, sounds like you have one bad position in your book. Can I hold your hand and help you sell?>> Hi Anonym#4,I simply do not want insults and vulgarities on this site,but if this is your style,feel free to say so.As for bad positions, NO BAD POSITIONS HERE,and you can shove your hand in your *****!!! So far for vulgarities!
Fri Feb 26 01:39:43 EST 1999
Alex: Hi Anonym#3,Omar is right,without SouthAmerica,its 35% less GNP in the US,check yourself!
Fri Feb 26 07:56:57 EST 1999
Puma: Does anyone knows when is Malan leaving the government? Take a guess
Fri Feb 26 08:03:57 EST 1999
Fox: Hi, Gentlemen. I know when Malan is leaving Goverment in the year 2003.
Fri Feb 26 08:11:22 EST 1999
Puma: Well, as you may know he tried to resign after the disaster of the band widening and as Cardoso asked him to stay he asked for the head of Chico Lopez. The president seems to have closed the dual message between monetarists and "desarrollistas"(read Jose Serra) in favor of Malan. But the point is that he is ready to go and he chose Fraga at the Central Bank because he wants him to be his succesor
Fri Feb 26 08:36:49 EST 1999
optimist: MOODY'S PLACES B3 DOMESTIC AND FOREIGN CURRENCY BOND RATINGS OF CITY OF MOSCOW ON REVIEW FOR POSSIBLE DOWNGRADE Approximately US$ 1Billion Securities Affected London, 26 February 1999 -- Moody's Investors Service placed under review for possible downgrade the B3 domestic and foreign currency bond ratings of the City of Moscow. A list of the affected bonds is appended below. Moody's said that with the domestic and overseas capital markets largely closed to the City following Russia's financial crisis in the second half of 1998, the City has built up its debt burden by taking out a large number of loans from Russian and Western banks to meet its investment programme obligations. Moody's said that these loans are mostly in foreign currency or linked to foreign currency, increasing the City's exposure to exchange rate risk. Although the City is still managing to balance its operating budget, a fall in tax revenues and an increase in tax arrears have constrained Moscow's financial flexibility and, consequently, its ability to service its debt, Moody's added. Moody's review will examine the plans and ability of the City to manage its growing debt burden in the context of the outlook for its operating performance and investment programme. The City of Moscow is the capital city of the Russian Federation with a population of some 8.6 million inhabitants. BONDS UNDER REVIEW FOR POSSIBLE DOWNGRADE EurobondsUS$ 500MDue 2000 EurobondsITL 400bnDue 2001 EurobondsDM 500mDue 2001
Fri Feb 26 08:41:17 EST 1999
optimist: City of Moscow eurobonds (4 papers) were put on negative rating watch by Moodys. Agency thinks Moscows euros may be downgraded from their current B3 rating. rgds
Fri Feb 26 08:46:18 EST 1999
Fox: True, true, could not agree more. Let's look at the situation now, the "desarrollistas" told the President that the only way to get to the "promised land" was via devaluation. The President bought the idea got rid of G. Franco and give F. Lopez all support. Next step was the substituion of Malan by Serra. Then what happens? We all know the story, F. Lopez makes that mini-band attemp and then lets the market go wild at the end of January. The President's rating approval goes down like a rock. At that point the President starts to question himself? These guys have conviction of what they are talking? Is it whise to give the ministry of finance to a man (Serra) with strong presidential ambitions? let's go back to the drawing board and give Pedro all support. So, yes, Malan may leave his post in a couple years, when things start to look better because he is probably tired.
Fri Feb 26 09:10:20 EST 1999
optimist: Has anybody heard rumours on possible 5 bio bond in Brasil?
Fri Feb 26 09:16:57 EST 1999
Fox: Yes, Optimist. The story goes like this: 1. Have Arminio approved. 2. Announce the new IMF deal. 3. Float a Eurobond like the dual Mexican of '95, in this case ot would be x% of R$ yield or a fixed US$ return.
Fri Feb 26 09:18:38 EST 1999
Puma: There was a rumor about a privatization bond some time ago. The bond was supposed to be backed by privatization revenues and some said that it was going to be partially subscribed by the US treasury (like the collateralized loan they gave to Mex in '95). Just remember that in the Brazil package there was no collateral invoved which show the strong political will to help them. In any case they might be trying to follow Martin Feldstein's advise on how to avoid a crisis: 1) Reduce Short Term debt 2) Accumulate liquid reserves 3) Organize a collateralized credit facility At the end of the day it is just... ...liquidity.
Fri Feb 26 09:21:06 EST 1999
Puma: If anyone cares the mentioned advise is on: Foreign Affairs March/April 1999 issue "A Self-Help Guide for Emerging Markets" by: Martin Feldstein

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