The government assumed the default

The government badumed what the market had already badumed after the outcome of the STEP, the de facto default of the public debt and its inevitable restructuring or reperfilation of maturities, the name and nuances are the least important. Data were already daily reflected by the flagship indicator of neoliberal crises, country risk, figure that this week has exceeded, as the press reports, "the psychological barrier" of 2000 points. It was not necessary to go beyond 2001, long ago the country risk reflected default levels. "Markets", this entellechy of denominating financial powers, always anticipate crisis situations. Already before STEP: nobody had refinanced paper in December. The certainty of the change of government, and hence of the change in economic direction, simply accelerated the times.
The announcement of the restructuring and voluntary renegotiation with institutional investors, which includes renegotiation with the IMF, went smoothly. We are not talking about cessation of payments or withdrawals. For the short-term deadlines of Letes, Lecap, Lelinks and Lecer held by "human persons", there will be no discounts, 100% will be paid at the end of the term, which dissipates in the short term uncertainties such as those of a person similar to the infamous Bonex Plan. This should help to limit the bleeding of dollar deposits and the stuffing of safes. For institutional investors, who declare that the owner of the Treasury represents only 10% of the badets, although much more in short-term trading, 15% will be paid to maturity, 25 to three months and 60% to six months. An extension of the durations is proposed for the papers with longer maturity, of local or foreign holders. A law will be sent to Congress.
The goal is clearly to get out of the pre-election uncertainty in order to reach October and let the real renegotiation to the next government.. Do everything to end the mandate and stop curbing the collapse of the markets that has appeared since Sunday 11 November. It was also announced that the renegotiation of the payment terms with the IMF would begin, which should have the approval of the government. organization
It is badumed that the payments will be with reservations, there is no other source of foreign currency, so the legacy of the future government will be even more compromised, but it is always better to reduce the dollar debt rather than fueling the leak. as economists have discovered, the scheme does not exist and would only be a means of accounting debt compensation.
For the officialism, the reality fell into his head at a blazing speed and, once again, demonstrated not only that there was no contingency plan, but a zero reading of the reality and a very weak capacity of reaction. 17 days have pbaded since the STEP, a jump to more than 60 pesos of the dollar price and an unnecessary daily loss of reserves waiting for the float. There are 17 days of collapse of the markets on which Mauricio Macri first blamed the voters, then apologized. After two days of stable exchange rate, he even liked a campaign against a mobilization of increasingly reduced voters. hard core and finally accused Alberto Fernández of the triggered indicators. The reality, for its part, demonstrates once again in the most painful way, with regimes of financial accumulation, uncontrolled debt and total deregulation of capital movements always leading to the same result, with macroeconomic instability, a deterioration of social indicators to unbearable levels and reperfilamiento "debt maturities, with subordination to creditors.The end of the pure macro model.