The Most Dangerous Politician In Latin America Wrote A Chilling Op-Ed About His Meeting With Hedge Funds
Little has been written about how it went, but based on the chilling op-ed Kicillof posted on President Cristina Fernandez de Kirchner's website on Tuesday, we can only imagine that things went badly.
What's your take?
"The vulture funds never wanted to come to the terms accepted by the vast majority of creditors," Kicillof wrote. "They're trying to extort a sovereign nation. They want privileged conditions and and they will stop at nothing to reach their objective: They try to interrupt the flow of payment to Argentine bondholders, denying them their right; they are going to speculate on the future of 40 million Argentines that have made enormous sacrifices to get on their feet after the 2001 crisis; and they're going to cause irreparable damage to the international financial system, putting all restructuring in doubt and making future restructuring practically impossible."
What Kicillof is describing doesn't sound like the hedge funds are asking for negotiation, what he describing sounds like they're asking for complete and total surrender.
This Argentine administration has always been good at that kind of language, though.
Kicillof is a Marxist ideologue and former professor who spearheaded the Argentina's takeover of YPF - the Argentine subsidiary of Spanish oil and gas company, Repsol.
In other words, he is not one for tepid opinions or gestures.
In this bond case, it has always been Kicillof's stance that these "vulture funds" - who are suing to get 100 cents on the dollar for their investment in defaulted Argentine bonds dating back to the country's collapse in 2001 - "never lent Argentina money," because they bought the bonds after the country defaulted.
Over 90% of bondholders with this debt restructured in 2005 and 2010. To Kicillof, that was the time for negotiating, and the fact that NML did not is a show they they were only interested in speculating on Argentina's future. He also managed to get a shot in about the fact that NML is based in the Cayman Islands in order to "avoid paying U.S. taxes." (Ouch.)
Kicillof's op-ed was, in part, a response to an op-ed published in the FT by Jay Newman, a portfolio manager at NML. Newman said that he and his group were willing, and have always been willing, to negotiate with Argentina.
But again - Kicillof says it was NML who showed bad faith at the meeting. The "vulture funds" refused to put a stay on all payment to bondholders as negotiations were underway. This is key, because according to a U.S. Court's "unfair" ruling, Argentina cannot pay some bondholders and not others. It gives Argentina until July 30th to either pay up or default.
Kicillof closed his piece saying - "The vulture funds don't negotiate: that's what makes them vultures."
He meets with the Special Master again on Friday.