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It's not directly useful for Maduro. They bought the bonds in the secondary market for a seventy percent discount. Maduro made no money off the sale. And at tha
by tgb 9y ago
It's not directly useful for Maduro. They bought the bonds in the secondary market for a seventy percent discount. Maduro made no money off the sale. And at that large of a discount I don't think he'll have an easy time selling new bonds to anyone either.
- tyingq 9y agoMakes sense, but I still see the reason oppressed people would make a stink. If only to broadcast that it will be bad optics for any foreigner to support the current regime...or even appear to. Propaganda is likely going on both sides.
- whatok 9y agoThe only reason why this is even made public is because Goldman is a big and easy target. There are mutual funds that I wouldn't be surprised a bunch of people here hold that easily dwarf GS in this space.
- tyingq 9y agoSure, but that seems logical. If you want to make a deterrent, use a big name that will get press coverage, even if they bought on a secondary market. For example, I'd be loath to buy Sudanese investments, even if I could prove it was a secondary market buy. The association just has bad optics.
- graedus 9y agoI agree, but GS appears to be resilient against bad optics so far. Some negative stories are written about them, some people on the internet call them 'criminal banksters', but no matter what happens they continue to make vast amounts of money and ex- (and likely future) employees seem to reliably find their way into top offices of government, central banks and other powerful institutions.
- jevgeni 9y agoIt isn't much of a deterrent, if you know that only a single competitotor of yours or just a few companies will be singled out for the outrage. Time and time again. There are fund managers, pharma companiess, and industrial conglomerates that acted way more shitty than most banks, but people tend to ignore that or forget that very quickly.
- tyingq 9y agoWell, it did give the opposition a podium that they didn't otherwise have. I would guess many of us wouldn't have thought about Venezuela today otherwise.
- jevgeni 9y agoI like this idea. Although the economic arguments aren't particularly strong, they give the opposition an opportunity to be noticed.
- DarkKomunalec 9y ago"but people tend to ignore that" You mean it doesn't get much media attention.
- jevgeni 9y agoYes. :)
- whatok 9y ago70% of par, 30%~ from where they were trading throughout the month.
- 1zq 9y agoFrom the article: > While Goldman Sachs defended its trade by saying that it bought the bonds on the open market from a broker, bankers and traders say the money ultimately ended up in Venezuela’s treasury because the seller was an institution with ties to the government.
- tgb 9y agoGood point.
- jevgeni 9y agoWhich still doesn't matter, if it's the secondary market. You can't borrow $100 and get more than that.
- jessaustin 9y agoWhat stops Maduro from issuing a bond for $1000 and selling it for $100? After all he knows he'll be dead or in Switzerland when the bond matures. He just cares about the $100 now.
- jevgeni 9y agoWhat's the difference between issuing a bond by Maduro and selling it?
- jessaustin 9y agoWhen he issues a bond, he takes a piece of paper (perhaps not literally...) and stamps "Venezuela will pay bearer $1000 on 1 January 2025" (or whatever) on it. When he sells it, he gives the piece of paper to someone else and in return they give him money, theoretically the present value of the bond. The discount between the two amounts is mostly an indication of Venezuela's creditworthiness, but of course a portion of the difference is just a reflection of the discount rate for assets to be delivered in future. This is exactly the same as when any other entity issues a bond.
- 9y ago
- dagw 9y agoAccording to the article the bonds where bought from a group with ties to the government.
- chiph 9y agoAt that quantity, I expect they just set a new price for them.