Argentina’s Possible Default Will Shape Future Investment Decisions

Argentina’s Possible Default Will Shape Future Investment Decisions

Argentina’s sovereign debt crisis and possible default will have “minimal immediate impact” on global bond markets, but it could “shape how decisions are made in the longer term,” says the international investment strategist at one of the world’s largest independent financial advisory organizations.

Argentina trying to avoid second default in 13 years

The observations from deVere Group’s Tom Elliott follow Tuesday’s unveiling of a controversial plan by the Argentine government aimed at avoiding Argentina’s second default in 13 years.  Under the plan, the country would swap its existing bonds governed by U.S. law for those that fall under its own jurisdiction, with the result that they would no longer be subject to the U.S. legal system.   The move comes after a string of adverse U.S. court rulings.

What Investors Need To Know When Choosing A Private Equity Manager

investor 1652197064It's no secret that this year has been a volatile one for the markets. The S&P 500 is down 18% year to date, while the Nasdaq Composite is off by 27% year to date. Meanwhile, the VIX, a key measure of volatility, is up 49% year to date at 24.72. However, it has spiked as Read More

Mr Elliott comments: “The pressure is mounting on Argentina but I believe that there will be minimal immediate impact on the global bond markets. Argentina has been on ‘the naughty step’ for a long time, meaning very few international investors hold Argentinean debt.

“The flirting with another possible default is a case of ‘history repeating’ in many respects and, I suspect, it will be largely considered in the wider markets as a local issue.  For these reasons, I’m fairly sanguine that other markets will not be adversely affected by the actions of Buenos Aires.”

Fallout of Argentina’s debt crisis likely to shape investment decisions

He continues: “However, the fallout of Argentina’s debt crisis is likely to shape how investment decisions are made in the longer term.

“After the U.S. Supreme Court refused on Monday to overturn previous rulings which ordered Argentina to pay billions of dollars to some of its long-term creditors, investors will increasingly be noti