We must seize this historic opportunity to repair this catastrophe

On Tuesday the 13th, it was clarified what advised investors knew. Those who left in the best scenario-Sturzenegger and Caputo– When they simulated brave dollar bids to stop the rally. In fact, it was an outlet for the tribe before the storm. Those who stayed will try to recover chips, but they will be more and more nervous. The value of the bonds is destroyed.

Restructuring Debt in the Market I've learned some things. The platform of the negotiation is that both parties badume their responsibility: the one who received the loan has miscalculated the possibilities of realization. And the one who gave the credit had predictability errors in his flow models.

The negotiator is another problem. Your temperament and your background favor or not. His charisma – although it is a gift – is a crucial badet. And the speed. You can not go to the hospital by bus.

Actors must quickly face the restructuring of the public debt. I should not repeat 2005. And, I do not rule out the fact that a successful renegotiation is the basis for building the next paradigm of global debt. The proposal contains provocative reinforcements, new alternatives. A global avalanche is coming.

The keys: strategist, tactical plan and executor

Should renegotiations (2005 and 2009) be a point of anchorage? Or do we have to adapt to a global environment that has changed significantly? Innovation, creativity and disruption are suggested. We must redesign a country to survive and succeed. We must feed, create jobs and grow. At the same time, the debt must be restructured, without which it is impossible.

The growth, welfare and debt reduction scenario is not similar to 2003-2007 and 2010-2011, when managing the economy was a trip for graduates. With the results of 2003-2011, Duran Barba would have made Macri an emperor for life. Instead of saying it, we focus on cabotage. What you need to know now is not on Wikipedia. During a renegotiation, the operator must have a technical and executive mastery to improvise. Nielsen would be an amazing coach because he can not be the representative. It would not be well received. If you choose a stable distribution member – technopol or institutional consultant – beware.

Only a "banking club" led by the IMF

"Reorganization outside of courtesy" or "amicable solution" avoids excessive disrepute of a breach. This gives more privacy and reduces costs. There are no legal costs. The law of equality works. Facilitates joint application. If there is a dilemma, it is that of the permanent disparity of criteria between creditors. Restructuring can sparingly generate significant losses, longer duration of the conflict, badet restrictions, and surprising executions – because we do not even know what the government has signed in those years.

New tool for new problems

The first question that creditors ask is this: what will it change so that we are in agreement? – That is why the proposal presented is crucial. We will have to keep the imagination moisturizing dried out ideas.

Restructuring in itself does not solve all the problems. But since the next administration will develop a growth plan, debt sustainability will be guaranteed. This is why it is appropriate to propose to the IMF the creation of a new operation – depending on the times – that we will call: GAP, "Grow and Pay".

This new financial tool would allow the IMF to react to a possible cessation of payments by extending the financing conditions of insolvent countries. Support policies that help grow and avoid social conflict. Get out of a crisis by reasoning instead of streamlining.

The convenience of a payment proposal:

Debt and interest are initially consolidated. Argentina needs 10 years of grace, where it will only pay interest. As a result, GDP and the budget surplus increase over the first 10 years of accumulation and the financing of growth is avoided. Standing in Argentina, contributes to the functioning of the international financial system. An innovative reform would be more appropriate than a global shock. This should be as fast as the IMF's decision to return to Argentina after 13 years. Remember, we renegotiated the agreement at two weeks and they fired Caputo in two months. vertiginous

Prolonged renegotiation destroys wealth. The IMF and private banks need to keep the debt "performing" in the balance sheets to avoid a catastrophe, with effects of guarantee. The entities badyze how much they will charge and how they will punish their balances.

Nail joint negotiation where the IMF is judge and party. He clearly leads interests, pouring nothing to save some and leave others.

Mandated process for private sector debt holders. The debt is described in stages. New securities must have the same duration and interest rate as the IMF's maturities. Beginning in year 11, capital repayments begin. These would be in total 12 and the increasing percentages: 2%, 3%, 4%, 5%, 7%, 8%, 9%, 10%, 11%, 12%, 14%, 14%, 15% . Option, carry clause for the IMF. The private bondholders must adhere to the same conditions and interest rates as the IMF, I suggest 3% per annum.

An economic plan with a GDP growth rate of 4 percentage points per year would cross the curves. GDP and budget surpluses exceed debt, which decreases the debt-to-GDP ratio in an inclined manner, increases debt sustainability and reduces risk until the investment level is reached, probably before the end of the year. Total cancellation.

Through creativity, the IMF solves one problem and anticipates another. It is claimed and is a real contributor to the Argentine recovery, stabilizing the international financial system. At the same time with Argentina, the funding needed to keep the bureaucracy of the organization is badured. Together, the IMF is "rebuilt", in anticipation of the conflict projected by global debt on GDP. In less than seven years, this relationship has grown from 200% to 320% of global GDP. The reduction of interest and the voluntary extension of conditions are the key to avoiding tragedies. If you do not get a substantial decrease in the rates you paid, the complicated default will arrive and we will proceed with a withdrawal of capital.

No more vultures making fun of 95% of the creditors. The high rates paid by the Macri government show that mistrust has never stopped paying them.

The IMF instead of being the villain of the film office guarantees that Argentina will grow and that everyone can charge. The plot that suggests the IMF is seeking the resignation of the sovereignty of countries is abandoned. Their authorities would show that they are not interested in a geopolitical operation.

By saying yes to the proposal, a disturbing episode of the financial system can be avoided, with future replicas. The budget balance and confidence return, the risk of default is excluded.

Proposal. Advantage:

1. We are credible: Arrive those who restructured and paid the debt, even with reservations. There was clarity and integrity, so you can play again.
2. Viability: Argentina is worth more alive than dead.
3. Growth: Debt restructuring avoids the opportunism of some creditors. Growth is turning into a self-liquidating debt.
4. Objectivity: no threats, no teenage expressions. A comprehensive plan with projective simulations showing how you can pay and how you CAN NOT pay.
5. Transparency: IMF leaders avoid differential treatment, such as that obtained by vulture funds. Immortalize it, between 2016 and 2019, we lie to new lenders.
6. Bet Pbadu: the guarantees are not reinforced. Payments of principal and interest are suspended. It is negotiated with a single team whose mandate is entrusted to all creditors.
7. Convictions: no pressure changes the equality of treatment between the agency and the private sector.
8. Cumulation of dollar reserves and a pesos account with the surplus, as long as it is not amortized, the debt is redeemed at par.
9. The executor-representative is an outsider, he's not a technopol-no consultant for the institution-no corporations, no former minister, former secretary; Because given the price of bonds, the information will have a lot of value. The country only speaks through a representative who does what the president asks.
10. Segregation of Duties: Debt restructuring is an extremely complicated, time-consuming process. The executors of the growth plan and the monetary and monetary stability can NOT be the same as those of the negotiation.
11. The process will require experience, calm and creativity.
12. IMF leaders would make sure that the best is for the evaders. That the prisoner's dilemma does not happen again.

During my recent trips to New York, I found that banks in the distance did not see what was happening. They never thought of a fault. They were delighted, as if by a witch. What I heard there does not differ from the commentators of the government, the majority of Argentine TV programs.

(*) Master in Economics and International Economic Policy and Professor at UADE, CEO and co-founder in 1993 of the Do Group