Oh oh. U.S. Banks Are Hunting for Collateral to Back $20 Billion Argentina Bailout [View all]

[usonian]

WSJ, archived

Banks are looking for assets or guarantees from the U.S. that would back a private-sector loan to support Argentine President Javier Milei

https://archive.ph/oIXoC

Nothing could POSSIBLY go wrong.
Magic fairy dust is discussed in the article.

A group of banks including JPMorgan Chase, Bank of America and Goldman Sachs is struggling to put together a $20 billion loan to Argentina without leaving themselves on the hook to the virtually-bankrupt South American country, people familiar with the matter said.

The bank loans would be part of the Trump administration’s plan to backstop the finances of libertarian President Javier Milei’s government with a $40 billion package, including a $20 billion currency swap with the U.S. Treasury Department and the separate $20 billion bank-led debt facility.
The group of banks, which also includes Citigroup, is seeking some type of guarantee or pledge to ensure they will get their money back, the people said. Bankers are waiting on guidance from Treasury on what collateral Argentina would be able to provide for them or if Washington would plan to backstop the facility on its own, the people said.

While banks normally arrange these types of rescue facilities on their own, Treasury has been controlling the broader package and banks feel they can’t act without backing from Washington, some of the people said. The loan facility hasn’t been finalized and might not come together if the banks’ collateral question isn’t resolved, they said.

Quote of the century;

“The risks from these operations are unusually large,”

51st. State upon default? Damn lot of nazis live there.

"JERRY-mandering"

Sorry, couldn't resist. I grew up in MA and know my Elbrige Gerry!


https://en.wikipedia.org/wiki/Elbridge_Gerry