Foundations of Financial 4 - bound

 

2 hours ago

Divya Petchiappan 

Week 7

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The article talks about Argentina having to pay interest on dollar and euro-denominated par bonds, the article explains that during Argentina’s $65 billion foreign debt restructuring a small number of bonds were overlooked. The article explains that the restructuring involved exchanging the default bonds with newer ones at a different rate and that the restructuring would ensure that Argentina would not be locked out of international credit markets. The government paid $12 million in interest to the investors and mentioned that paying the interest on bonds would “avoid the adverse consequences and uncertainty for Argentina and the investment company” (Otaola, 2020, para, 5). The deal was agreed upon several months of debating and compromise and according to the government, it will help bolster the economy in the long run and help Argentina on the path of economic-financial normalization.  

References 

Otaola, J. (2020). Argentina to pay interest on Par bonds it failed to restructure. NASDAQ. https://www.nasdaq.com/articles/argentina-to-pay-interest-on-par-bonds-it-failed-to-restructure-2020-09-28 

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1 day ago

Privilege Adagbonyin 

Re :Week 7 - Bonds

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The article i reviewed   reports that  bonds of lower rated mortgages tied to  hotels and office in the USA have not been able to rebound as an aftermath of the  corona virus pandemic . 

 amazingly i find out that this bonds are rated  triple B rating  which is the lowest broad investment grade tier >the news further reported that the tracking of such investments of mortgaged backed bonds  showed that bonds with a concentration of hotels and and retail properties are  struggling even more . The news further tried to contrast this  sluggish recovery of hotels bonds  with the sharp rebounds encountered in higher rated securities   following the intervention of the  feral reserve intervention in the credit market earlier in the year . the news further  forecasts that it will take much much longer for the recoveries because  the highly delinquent and volatile nature of this kind of mortgage debt . this situation is further exacerbated by the fact that due to the pandemics  long term leases of leasing spaces  which serve as revenues in this hotels are being canceled thereby casting a forlorn  shadow on the outlook for hotel backed bonds . an interviewed head of real estate credit however expresses optimism that hotel  bonds will recover as commerce improves . 

https://www.wsj.com/articles/bonds-tied-to-hotels-retail-properties-struggle-to-recover-11600680600

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