[Marxism] Bonds That Bind: Argentina, Venezuela, and the US Current Account Deficit

Yoshie Furuhashi furuhashi.1 at osu.edu
Tue Mar 29 08:53:32 MST 2005


"Bonds That Bind: Argentina, Venezuela, and the US Current Account 
Deficit" (Argentina successfully forced more than three quarters of 
its creditors to accept 35 cents on the dollar, but NML Capital, a 
Cayman Islands-based hedge fund, is striking back, winning a freeze 
on $7bn of the old bonds tendered in restructuring.  The IMF is 
already changing its tune, now publicly sending a signal that it may 
ask Buenos Aires to reopen its $102.6 billion debt swap to 
renegotiate with hold-outs.  Bad news on the litigation front came at 
the same time as emerging market bonds and stocks, having flourished 
in the credit bubble, dropped in response to rising US interest 
rates.  Washington's belated attempt to address the US current 
account deficit through higher interest rates alone, without giving 
up on the Iraq War and tax cuts for the rich that have pushed up its 
fiscal deficit or doing anything to resuscitate its atrophied export 
base, may be now beginning to take a toll on the global economy.  In 
the meantime, Venezuela, in a gesture of solidarity, "said it will 
buy $500 million of 7-year bonds that Argentina plans to sell within 
two weeks, the first bond sale for Argentina since its 2001 default" 
says Peter Wilson of Bloomberg.com.  Is it any wonder Hugo Chávez's 
"petro populism" is more popular among Latin Americans than the 
moribund Washington Consensus?) -- FULL TEXT: 
<http://montages.blogspot.com/2005/03/bonds-that-bind-argentina-venezuela.html>.
-- 
Yoshie

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