Latin America
Related: About this forumUS Council of Foreign Affairs supports Argentina, blasts Judge Griesa
Thursday, June 26th 2014 - 05:12 UTC
US Council of Foreign Affairs supports Argentina, blasts Judge Griesa
The Council on Foreign Relations, one of the most influential private organizations in US Foreign Policy, questioned the US Supreme Court for rejecting Argentinas appeal in its legal dispute with the so-called vulture funds, saying the ruling will diminish national sovereignty and upend international finance.
In a highly critical article published in its renowned Foreign Affairs magazine and signed by Felix Salmon, the Council bashes both the US Supreme Courts decision and Judge Thomas Griesas previous ruling, describing them as dangerous fundamentalism.
The consequences are certain to be dreadful for Argentina. More broadly, the ruling will make it more difficult for countries to free themselves from the burden of over-indebtedness. It will be very bad for international capital markets. Oh -- and it will also diminish national sovereignty, it reads.
Salmon focuses on the effects of the rulings on international finances, saying the Supreme Courts decision leaves open the questions of sovereign immunity, the future of sovereign debt restructuring, and the future of New York as a financial center.
In tune with Argentinas stance, the article states that if a country does default on debts, then it needs some way to cure that default [
] Because countries cant declare bankruptcy, exchange offers are the next best thing. But for those to work, a debtor country needs to be able to pay the exchange bondholders without paying the holdouts. Otherwise, no one would ever participate in an exchange, and no country could ever restructure its debts.
More:
http://en.mercopress.com/2014/06/26/us-council-of-foreign-affairs-supports-argentina-blasts-judge-griesa
Benton D Struckcheon
(2,347 posts)It was so stupid even one of the economists who regularly contribute to the Financial Times denounced it:
Defend Argentina from the vultures
This is a point most people don't really understand but the above is a very clear statement of it. Every percentage point over US Treasuries that you receive - US Treasuries being the benchmark for the lowest risk investment out there - you receive because you are taking on additional risk.
To then make it impossible for that risk to actually come about, as these people are doing and this idiot of a judge is saying should be allowed, is an obvious contradiction that will never stand. The Argentine governments that got themselves into this may or may not have been incompetent or worse, but that's for the Argentines to decide, no one else. If you buy their bonds you get paid for the risk you take on. You don't, or you shouldn't, get to sue because that risk you were paid to take on actually materialized.
Louisiana1976
(3,962 posts)pay them she shouldn't have to.