Argentina, UN approve a radical move on the “vulture capitalists”

Photo: National Bank of Argentina.

Photo: National Bank of Argentina.

By: Emile Schepers

Published by the People’s World

September 17, 2014


The Argentine Congress voted last week to take the function of paying off the country’s sovereign bonds away from the private Mellon Bank of New York and transfer it to the National Bank of Argentina, a state enterprise.  And the U.N. General Assembly passed a supportive resolution calling for a reworking of the entire system of dealing with the restructuring of sovereign debt.

The actions came as a sequel to a long running controversy over the efforts of U.S. hedge funds to make a large profit at the expense of the Argentine people.

From 1976 to 1983, Argentines suffered under the brutal U.S.-supported military dictatorship of General Jorge Videla and his colleagues, who stifled all dissent by methods that included murder of some 30,000 members of the opposition.

During this time of unaccountable rule by fear, the military rulers incurred sovereign debt for the country, through bonds organized through New York financial institutions. This pattern did not stop when the military left power in 1983, but continued in the chaotic period that followed, with Argentina under heavy pressure to implement neo-liberal policies of privatization, austerity and free trade.

By 2001, Argentina was broke and the enraged populace was in the streets. A new left-wing president, Nestor Kirchner, had to preside over a default. His government and that of his wife, current President Cristina Fernández de Kirchner, who succeeded him, managed to restore their country’s finances without the usual method of balancing the budget on the backs of the poor, by persuading the vast majority of creditors to accept new bonds at 30 cents on the dollar.

However, a small minority of the creditors held out, demanding that they be paid 100% of the original value. These include Elliot Management, whose major investor is Paul Singer, a heavy contributor to Republican Party candidates in the United States, and Aurelius Capital Management. These are not even the original bondholders: They bought these bonds from the original bondholders at fire sale prices when Argentina defaulted, and now they want not just to recuperate their original cost plus a profit, but to receive the entire value of the original bonds, pocketing an immense profit.

The way the bonds were originally set up stipulates, according to U.S. Federal Judge Thomas Griesa, that until Argentina pays off Singer and his allies in full, at the original price they demand, it cannot continue to pay a penny to the majority of bondholders who agreed to the bond swap. And if it agrees to pay the holdouts what they demand, it also has to offer those creditors who accepted the swap the same full payment as to the holdouts. So Griesa froze a payment Argentina had made to an account for the majority bondholders in Mellon Bank New York, to the tune of $539 million dollars, forcing Argentina to miss a July 30 deadline on those payments.

Thus, Griesa says, Argentina is in default again, which Argentina denies. The Argentine government took out ads in U.S. and Argentine newspapers declaring that they are not in default and referring to the hedge funds as “vulture funds.” Griesa has threatened to find Argentina “in contempt of court” for doing this.

Singer is well known for this kind of tactic, which he has employed to the detriment of the people of Peru and of Congo (Brazzaville). The precedent set if Argentina loses would represent a danger to all efforts at restructuring the debts of poor countries. The winners would be wealthy hedge funds in the rich countries, and their political allies.

So it is not surprising that President Kirchner has been getting strong support from other Latin American countries, from the BRICS countries (Brazil, Russia, India, China and South Africa), and from the Group of 77 developing countries.

Bolstered by this support, Kirchner asked her legislature to support a measure whereby the control of the payments of sovereign bonds would be moved away from Mellon Bank New York to the government-controlled National Bank in Buenos Aires. That way, the bondholders who agreed to the swap will get their payment in Argentina, and U.S. courts will not be able to interfere. Both houses gave this proposal a solid majority last week.

China, the Group of 77, and Bolivia brought the Argentine case to the U.N. General Assembly.  The proposal was to move forward on changing the framework for the restructuring of debt. There were 124 votes in favor, including almost all poorer countries. Only 11 countries voted “no,” including the United States, Britain, Germany, Japan, France, and other wealthy states. There were 41 abstentions.

The U.S., which had earlier filed an amicus brief in Griesa’s court favoring Argentina, says that it voted against the U.N. Resolution out of fear that it would create instability in financial markets.



Arrogance and Stupidity: The EU “Demands” Argentina to Ban Food Exports to Russia


By Peter Koenig
Global Research, August 17, 2014

Region: Europe, Latin America & Caribbean, Russia and FSU
Theme: Global Economy, US NATO War Agenda
In-depth Report: UKRAINE REPORT


nato-eu-un-nato3-400x335Imagine – Argentina – and the rest of Latin America – being urged by the EU, ultimate puppet of the US not to supply Russia with food stuff – vegetables, fruit, meat – after Argentina was ‘punished’ by a corrupt court in New York to pay 1.5 billion dollars to the fraudulent NML Capital et al vulture funds – out of its current agreed upon debt of US$29 billion – equivalent to Argentina’s total reserves.

And yes, the hedge funds have to be paid 100%, when the remaining 93% of creditors agreed on a 20% reimbursement rate. – And, yes, Mr. Griesa, the bought NY judge, has blocked all of Argentina’s payments to the other creditors, unless his vulture clients are paid in full. So, Argentina is in forced default – having to pay now much higher interest rates on international money markets, if she is indeed still eligible for international credits.

Unimaginable but true.

Under these circumstances, the boundless arrogance of Brussels expects Argentina to ascend to the US / EU sanctions on Russia to which Russia responded by banning all imports from the EU? – And is now seeking trading with South America?

Not that Russia really needs food from South America – there is an enormous and willing Asia market open to them. Russia’s gesture is a helping hand to Argentina and South America to free themselves from the economic and political pressures constantly exerted on them by Washington.

Argentina will laugh at such a ridiculously stupid request from the EU.

Good for Russia – and good for Argentina, Brazil, Chile, Peru et al – to finally escape the claws of the predator empire of Washington and go the way of independence, namely towards a new area of economic sovereignty and world monetary system.

Good for the BRICS (Brazil, Russia, India, China and South Africa), as they may finally come to a consensus among themselves and issue their own currency, backed by about one third of the world’s economic output and about half the world’s population.

Of course, such a primitive move by the EU begs the questions – have the leaders (sic) of the EU, pushed by the unfathomably senseless mouthpiece of NATO, Fogh (of war) Rasmussen, lost their last shred of sense and sovereignty? – have they indeed degenerated to the level of brainless, spineless dummies? – Do they not realize that if they succeed helping Obama and his blood-thirsty NATO war machine engaging Russia in WWIII that their countries with the countless NATO bases will be the first targets of Russia’s defense? – I.e. – Europe being destroyed – again?

Don’t they realize that Russia, after having been the key liberator of Europe from the Nazi WWII fangs – at the cost of 25 million Russian lives – that Russia not only wants to save Europe from another humanitarian disaster, but would like to help them out of their Wall Street imposed economic disaster by trading with Europe? – That Russia and China would like to form an alliance with Europe – a peace alliance not war alliance à la NATO?

Can’t they – the EU, see the light after Mr. Xi Jinping, President of China traveled to Germany to offer Madame Merkel this spring a New Silk Road, linking Berlin with Shanghai? – An extraordinary potential for economic development throughout Asia, away from the decaying war driven economy of Washington, the Pentagon and the ultra-corrupt financial system dominated by Wall Street the FED and the BIS (Bank for International Settlement)?

Argentina and the other Latin American countries invited by Russia for trading food and other merchandise – most likely will see the light.

If the BRICS are not yet ready with an alternative, dollar delinked currency to replace the western predatory money machine, Russia and China are. The two countries have forged a solid political and economic alliance during the past few years, have a combined GDP of US$ 21.1 trillion (China – US$ 19 trillion; Russia US$ 2.1 trillion – est. 2014), equal to about 27% of the world economic output – US$ 77.8 trillion (est. 2014).

Russia has already announced that the ruble is backed 100% by gold – which is not a reference in itself, but enhances the solidity of their countries’ manufacturing and construction output. This compares with a US GDP of US$ 17 trillion, mostly based on the output of the war and security industrial complex, meaning a GDP of destruction – and on consumption, as well as hollow financial and legal services.

While the BRICS are getting their act together, it is conceivable that Russia and China will issue shortly their own combined currency – the ‘Ruyuan’ or the ‘Yuanru’, delinked from the corrupt, predatory western monetary system; a new monetary alliance could also replace the dollar as reserve currency. Controlling more than a quarter of the world’s economic output and a majority chunk of the Asian market, a combined China-Russian currency would have an infinitely more solid backing than has the fiat dollar – as well as meanwhile also the fiat euro – to become a serious reserve currency. – It is only a question of time until much of the rest of the world will jump on the occasion and abandon the dollar.

All it needs is one country that dares to take this first step – fearless of sanctions, as they are meaningless under a news monetary system.

Argentina would be well advised to switch its payments to the 93% of creditors with whom it reached debt settlement agreements between 2001 and 2010 from the rapacious US-dominated financial system to Russia and China by dollar – yuan and ruble swaps with the two respective central banks – see also

Argentina could become the first country to free itself from the economic sledgehammer of the immoral United States – and at the same time enter into trade agreements with Russia and China. Already today 90% of Argentina’s foreign trade takes place outside of the realm of the US dollar.

The question that begs asking is – what will eventually Europe do, when it realizes that it is living on a house of cards that can crumble – and crumble it will – at any time? – What will happen to the Wall Street-FED-Troika (IMF, ECB, EC) lynched Euro, when the people who invented the dollar degenerate into mere brainless greed and war machines? – When they become incapable of thinking by themselves, of recognizing their sovereignty – the highest asset any organized society can claim for itself?

Will eventually the peoples of Europe stand up and get rid of their Washington imposed neoliberal fiefs, grasping the breath of fresh air coming from the East and seeking a healthy alliance, striving for peace and human rights?

It is never too late. Argentina could well become the cornerstone for a new era.

Peter Koenig is an economist and former World Bank staff. He worked extensively around the world in the fields of environment and water resources. He writes regularly for Global Research, ICH, the Voice of Russia, Ria Novosti and other internet sites. He is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed – fiction based on facts and on 30 years of World Bank experience around the globe.

Guns N’ Roses first show with Duff McKagan in 17 years: Setlist + Tour Dates


Last night, Guns N’ Roses headlined a show in Buenos Aires, Argentina and for the first time in 17 years, Duff McKagan served as the band’s bass player. As previously reported, McKagan has temporarily rejoined the band filling in for Tommy Stinson, who’s playing with The Replacements at Coachella. Axl Rose made quick use of his new (?) bassist, having him sing lead on a cover of Misfits’ “Attitude”, the band’s first such performance of the song since 1993.

GNR also covered The Stooges’ “Raw Power” for the first time ever and smashed their way through renditions of Led Zeppelin’s “Babe I’m Gonna Leave You”, The Who’s “Seeker”, and Wings’ “Live and Let Die”. They also played a whole bunch of originals, including material from Chinese Democracy, again with Duff on bass. Let that sink in for a few seconds.

Below, footage of their Misfits cover and see the full 35-song setlist. GNR next plays Paraguay on Wednesday night.




“Live and Let Die”




Chinese Democracy
Welcome to the Jungle
It’s So Easy
Mr. Brownstone
Rocket Queen
Nice Boys (Rose Tattoo cover)
Attitude (Misfits cover) (Duff McKagan on lead vocals, first time played live since 1993)
Raw Power (The Stooges cover) (Live debut)
My Michelle
Guitar Solo (Richard Fortus)
Live and Let Die (Wings cover)
This I Love
Piano Solo (Dizzy Reed)
Catcher in the Rye
You Could Be Mine
DJ Ashba Guitar Solo (La Bella Vita)
Sweet Child O’ Mine
Jam (“Babe I’m Gonna Leave You” by Led Zeppelin)
November Rain
Abnormal (Bumblefoot cover)
Don’t Cry for Me Argentina (Julie Covington cover)
Don’t Cry
Used to Love Her
Civil War
Shackler’s Revenge
Knockin’ on Heaven’s Door (Bob Dylan cover)

The Seeker (The Who cover)
Paradise City

Guns N’ Roses 2014 Tour Dates:
04/09 – Asuncion, PY @ Jockey Club ^
04/12 – La Paz, BO @ Estadio Hernando Siles ^
04/15 – Recife, BR @ Chevrolet Hall ^
04/17 – Fortaleza, BR @ Centro de Eventos de Fortaleza ^
04/23 – Los Angeles, CA @ Club Nokia (Golden Gods)
05/13 – Bethlehem, PA @ Sands Bethlehem Event Center
05/16 – Columbus, OH @ Columbus Crew Stadium (Rock on the Range)
05/21 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
05/24 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
05/25 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
05/28 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
05/30 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
05/31 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
06/04 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
06/06 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino
06/07 – Las Vegas, NV @ The Joint at Hard Rock Hotel & Casino

^ = w/ Duff McKagan