LATIN AMERICA UPDATE: Argentina Bondholders Are 2-0 Enforcing Their Contractual Rights (citation: Richard J. Corbi and Oscar N. Pinkas, Argentina Bondholders Are 2-0 Enforcing Their Contractual Rights, XXXIII ABI Journal 1, 26-27, 60, January 2014) - Richard J. Corbi and Oscar N. Pinkas

Five years after the collapse of Lehman Brothers triggered the largest global financial crisis since the Great Depression, outsize banking sectors have left economies shattered in Ireland, Iceland, and Cyprus. Banks in Italy, Spain, and elsewhere are not lending enough. China’s credit binge is turning into a bust. In short, the world’s financial system remains dangerous and dysfunctional, Economia reported in a commentary. Worse, despite years of debate, no consensus about the nature of the financial system’s problems – much less how to fix them – has emerged.

On August 23, the Second Circuit issued its long-awaited opinion on Argentina’s appeal from the Southern District’s amended injunction requiring that Argentina make “ratable payment” to the plaintiffs when it next makes payment to holders of its Exchange Bonds.

In responding to the Second Circuit’s March 1 inquiry as to how Argentina planned to “make current” the “original bonds” held by the plaintiffs, Argentina has once again made it clear that it will not treat the plaintiffs any more favorably than the Exchange Bondholders, no matter what the judicial consequences may be. Further, many of the points that Argentina advances in its reply to the Court’s inquiry have, in our view, already been rejected by the Second Circuit.

As Fernanda Castro waits in line to pay for a new blender at a store in a Sao Paulo shantytown, the hairdresser recounts horror stories of friends who fell into debt and struggled to get out, Reuters reported. "I don't want that to happen to me," she said. "I avoid using the credit card now. I'm afraid of it." After a spending spree in recent years, Brazilian consumers are acquiring more conservative habits.

¿Qué Está Pasando/O Que Está Acontecendo? - Going South: Recent Developments in Latin American Insolvencies (2013 ABI Caribbean Insolvency Symposium) - Luis Salazar, Leyza Florin Blanco, Javier Lorente, Christopher P. Carrington

21/4/2012: Having felt adrift ever since Venezuela’s Hugo Chávez fell ill last year, Latin America’s populists suddenly have a new champion. Cristina Fernández, Argentina’s president, has long been a chavista-lite, harassing private business, rigging national statistics and gutting state institutions. Of late she has shifted further in Mr Chávez’s direction, raiding central-bank reserves, imposing currency controls and raising trade barriers. Her most brazen move yet came this week with the nationalisation of 51% of YPF, the former state oil company, belonging to Spain’s Repsol.

16/4/2012: It started out like "Mission: Impossible" but has ended up more like "Meet the Fockers," minus the comedy. Western governments' emergency interventions in the financial sector during the 2007-2009 crisis and the more recent European turmoil have led to a messy relationship riddled with distrust and misunderstandings. The situation is understandable in the short-term but untenable in the long-run. In the U.S.

Over the next twelve months, expect unsettling developments, EconoMonitor reported. The global crisis is still unfolding, and it could escalate. Weakening growth, rising systemic risks, and contagion-prone markets are likely to enhance economic and financial fragility. We are entering a perilous new phase. First, growth will remain below potential, hindered by excessive debt. Since 2000, total world dues – the debt globally held by governments, corporations, and households – doubled (from 32 to 63 percent of global output), mostly in developed economies.