Euro-area bonds from Germany to Spain rose this week, pushing 10-year yields to record lows, as concern the euro-area’s economy is slowing boosted bets the European Central Bank will purchase sovereign debt. French 10-year rates were about five basis points from the lowest level since at least 1990 today after industrial production growth in the euro-area’s second-largest economy stalled in August. Factory output in the Netherlands declined, while in Italy it rose less than economists forecast. Portugal’s 10-year yields touched a record low amid speculation Fitch Ratings will raise the nation’s credit rating from junk status.
“There’s quite a lot of focus on the industrial data out of Holland, France and Italy,” said Lyn Graham-Taylor, a fixed-income strategist at Rabobank International in London. Government bond buying by the ECB “is now our base case. We see quite a lot of room for decreasing yields.”
Germany’s 10-year yield fell two basis points, or 0.02 percentage point, to 0.89 percent at 5 p.m. London time. That’s down four basis points from Oct. 3. The rate touched 0.858 percent yesterday, the lowest since Bloomberg began collecting the data in 1989. The 1 percent bund due in August 2024 rose 0.17, or 1.70 euros per 1,000-euro ($1,264) face amount, to 101.055.
Rabobank forecasts the rate will slide to as low as 0.70 percent, Graham-Taylor said. Spain’s 10-year yield fell four basis points this week to 2.07 percent and touched a record-low 2.03 percent yesterday.
Output Stalls
French (GFRN10) industrial production was unchanged in August after growing a revised 0.3 percent a month earlier. The report came after separate data this week showed German exports, factory orders and industrial production each slumped by the most since January 2009 that month.
Portugal’s consumer-price index, calculated using a harmonized European Union method, was unchanged last month from a year earlier after dropping 0.1 percent in the 12 months through August. France’s 10-year yield was little changed at 1.25 percent after touching a low of 1.203 percent yesterday. It was one basis point lower in the week. The Portuguese 10-year rate was little changed at 2.96 percent after falling to as low as 2.918 percent. The yield dropped nine basis points since Oct. 3.
ECB Policy
Benchmark German 10-year yields have more than halved since the end of last year as ECB President Mario Draghi cut deposit rates below zero for the first time and unveiled a program to purchase private bonds. The decline indicates investors are unfazed even as Draghi differs with Germany’s Finance Minister Wolfgang Schaeuble over what further steps to take if the euro-area economy keeps weakening.
As the International Monetary Fund’s annual meeting in Washington began yesterday, Draghi again pledged to loosen monetary policy more if needed and called on those governments with the room to ease fiscal policy to do so. By contrast, Schaeuble warned against U.S.-style quantitative easing and urged continued budgetary discipline.
The five-year, five-year forward inflation-swap rate, which Draghi said officials use to gauge medium-term price-growth expectations in the euro area, slid two basis points to 1.85 percent, the lowest level since Bloomberg began collecting the data in 2004.
Growth ‘Ebbing’
“The growth momentum is ebbing away,” Ashok Shah, who helps manage $4.3 billion of assets as investment director at London & Capital Group Ltd., said in an interview on Bloomberg Television’s “On The Move” with Jonathan Ferro. “In Europe I think we are very near to a zero growth rate across the board, going towards deflation.”
Greece’s bonds advanced for a second day as Prime Minister Antonis Samaras puts his government to a confidence vote. Samaras has tabled the motion to head off an opposition challenge and win fresh backing for his plan to end international aid from the euro area and IMF.
The 10-year yield dropped three basis points to 6.60 percent today. Greek bonds are the worst-performing securities in the Bloomberg World Bond Indexes over the past three months, having lost 5.3 percent through yesterday.
Treasuries Set for Biggest Weekly Gain in Six Months
Treasuries rose for a fourth week, with 10-year yields dropping the most in more than six months, on speculation the Federal Reserve’s concern that global economic growth is slowing may push back interest-rate increases.
Yields on two-year notes headed for the steepest weekly decline since 2010 as the International Monetary Fund cut its forecast this week for global growth and European Central Bank President Mario Draghi pledged to loosen monetary policy more if needed. Traders see about a 33 percent chance the Fed will raise its benchmark rate by its July 2015 meeting, down from a 59 percent on Sept. 18, fed funds futures data compiled by Bloomberg show.
“The Fed changed the goalpost again,” said Thomas Roth, senior Treasury trader in New York at Mitsubishi UFJ Securities USA Inc. “Most of the move this week was on Europe and the dollar and the Fed’s emphasis of it in the minutes. We’re now data dependent on Europe.”
The benchmark 10-year yield was little changed at 2.31 percent at 12:57 0.m. New York time, according to Bloomberg Bond Trader data. The 2.375 percent notes due in August 2024 traded at 100 17/32. The yield has declined 13 basis points this week, the most since the week ended March 14. It touched 2.28 percent yesterday, the lowest in more than 15 months.
Bond Returns
Treasuries returned 4.8 percent this year, after losing 3.4 percent in 2013, according to the Bloomberg U.S. Treasury Bond Index. (BUSY)
The U.S. two-year yield was little changed at 0.45 percent. The yield has declined as much as 13 basis points this week, the most since the period ended May 7, 2010. A number of U.S. central bank officials said the nation’s expansion “might be slower than they expected if foreign economic growth came in weaker than anticipated,” according to minutes of the Sept. 16-17 Federal Open Market Committee meeting released on Oct. 8 in Washington.
Bank of America Corp. cut its year-end forecast to 2.75 percent from 3.1 percent, citing weakness in stocks, declines in market-based inflation measures and the strength of the dollar.
Yield Forecast
The 10-year note yield will end 2014 at 2.70 percent, compared with 3.44 percent predicted at the start of the year, according to the median forecast in a Bloomberg News survey published yesterday. The estimate is the lowest for year-end 2014 since Bloomberg began recording forecasts for the period in July 2013.
U.S. stocks slumped for a second day and the Standard & Poor’s 500 Index headed for its longest streak of weekly losses since January amid concern that slower global growth will hurt the economy. “Nobody can really say where the bottom of U.S. yields is,” William O’Donnell, head U.S. government bond strategist at RBS Securities Inc. in Stamford, Connecticut, one of 21 primary dealers that trade with the Fed wrote in a note to clients. “When investors are rushing out of risk assets (like stocks) to protect principal, they don’t dither over basis points. It’s all about return of capital right now, and not about return on capital.”
Bank of America Merrill Lynch’s MOVE Index, which measures price swings in Treasuries based on options, rose to 66.47 basis points yesterday, the highest since Sept. 16. The amount of Treasuries traded through ICAP Plc, the largest inter-dealer broker of U.S. government debt, was $525 billion yesterday after climbing to $563 billion on Oct. 8, the most since May 2.
Market Difference
The extra yield benchmark U.S. notes offered over their Group of Seven peers shrank to 0.77 percentage point yesterday, the least since Sept. 3. The spread between yields on 10-year Treasuries and German bunds narrowed to 1.41 percentage points yesterday, the smallest difference since Aug. 19. The yield on German debt due in a decade fell to a record yesterday.
Pacific Investment Management Co.’s $202 billion Total Return Fund, which was managed by Bill Gross until his Sept. 26 departure, cut holdings of government debt last month.
Pimco’s Total Return Fund, the world’s largest bond mutual fund, reduced holdings of government-related debt to 38 percent in September from 41 percent the previous month, data posted on the company’s website showed. The category, which is the largest portion of the fund, includes holdings of U.S. Treasury notes, bonds, agency debt, interest-rate swaps and inflation-protected securities.
The fund has returned 4.14 percent this year, trailing 59 percent of its peers.
Pimco to Barclays: Your Bond Index Is Hurting Investors
Barclays Plc is pressuring investors to hold expensive mortgage securities by filling its closely followed bond index with debt the Federal Reserve has been gobbling up, according to Pacific Investment Management Co.
The problem is that the Barclays U.S. Aggregate Index includes the $1.7 trillion of government-backed mortgage bonds that the central bank purchased to bolster the economy, Pimco money managers Mike Cudzil and Daniel Hyman wrote in a commentary posted on its website yesterday. Because those holdings represent more than a third of the entire market, they’ve limited supplies of the notes and inflated their prices.
The composition of the index -- which doesn’t include the Fed’s $2.5 trillion of Treasury holdings -- encourages managers of mutual funds and other accounts that use the measure as a performance benchmark to add the mortgage securities, according to Pimco, the investment firm that oversees almost $2 trillion of assets even after redemptions following last month’s departure of its star investor and co-founder,Bill Gross. “The inconsistent approach in the index is detrimental to investors because they are being asked to hold historically expensive securities that are limited in availability,” said Cudzil and Hyman, co-heads of Newport Beach, California-based Pimco’s agency mortgage-bond team.
Mark Lane, a spokesman in New York for Barclays, declined to comment. The bank, which is seeking to sell its index business to cut costs and shrink its balance sheet, announced Oct. 7 that its team managing the benchmarks had begun their annual process of reviewing potential changes and gathering feedback. The Fed’s holdings weren’t among topics asked about for mortgage securities, which focused on pricing issues.
Fed Pullback
While only a guide for their investment choices, money managers with specific mandates risk reporting abnormally poor performance when they stray too much from their benchmarks.
The Fed has been reducing its debt purchases and is on pace to stop adding to the holdings this month. At the same time, it said last month it plans to continue reinvesting principal payments to maintain the size at least until it decides to raise its target for short-term interest rates. The Fed doesn’t plan to sell as it normalizes policy, though may in the “longer run” dispose of a small amount, it said.
Many investment firms supported Barclays’s decision to include Fed-owned mortgage bonds in its index when the central bank announced its first purchases in 2008 because the program was envisioned as “temporary,” the Pimco managers wrote. An adjustment is now warranted because “the Fed’s rhetoric and apparent plans have recently changed,” they said.
Citigroup Index
Citigroup Inc. mortgage-bond analysts in August also said it might be time for benchmark bond indexes to exclude the Fed’s holdings, because the current set-up “forces money managers to buy the sector even if spreads are rich.”
The share of the debt in Citigroup’s own BIG index would fall to 20 percent from 29 percent with such a switch, its analysts wrote. The Barclays’s index also contains 29 percent. Amid the Fed’s buying, yields on mortgage securities backed by Fannie Mae, Freddie Mac or Ginnie Mae have fallen to 0.23 percentage point more than Treasuries, compared with an average of 0.59 percentage point over the past 15 years, according to Bank of America Merrill Lynch index data.
Domestic money managers have been reducing their holdings as the Fed made the debt expensive, owning about $150 billion less than what their benchmarks prescribe, according to estimates by analysts at Nomura Holdings Inc. The investors may start buying a greater share as the Fed stops purchases, they wrote in an Oct. 9 note to clients.
Cutting Exposure
Not all managers try to track the most-followed bond indexes. The $101.4-billion Vanguard Total Bond Market Index Fund (VBMFX) uses a “float adjusted” Barclays index that excludes the Fed’s mortgage holdings, according to its website.
Pimco’s own $201.6 billion Total Return Fund is 20 percent invested in mortgages, according to data on its website. The share in that category, which includes other securitized debt, fell to 19 percent in April, the lowest since 2010. “At Pimco, we are employing active management across our fixed-income complex, generally reducing exposure to the mortgage bonds that have been made the most expensive by the Fed,” Cudzil and Hyman wrote.
Argentina Has Financing Offers From Investors, Kicillof Says
Argentine Economy Minister Axel Kicillof said the country has access to financing from private investors two months after a legal dispute blocked the country from meeting its foreign debt obligations.
Kicillof, speaking at an event in the country’s embassy in Washington yesterday, said he has met with five or six investors interested in providing loans. While Argentina has no plans to accept the offers, Kicillof they show the country still has access to credit after a U.S. judge’s order prevented the nation from making payments on its overseas debt, resulting in its second default in the past 13 years.
The country hasn’t sold debt in international markets since its $95 billion default in 2001. After the U.S. Supreme Court declined to hear its appeal this year, Argentina has been blocked from servicing overseas bonds until reaching a deal with creditors from 2001 who sued for full repayment, led by billionaire Paul Singer’s hedge fund Elliott Management Corp.
“A fundamental quality to any ruling is that it can be complied with -- which doesn’t apply here,” Kicillof said. “No country would obey.”
The country’s benchmark bonds due in 2033 slipped 0.45 cent today to 82.43 cents on the dollar as of 1:09 p.m. in New York. Elliott, which refused debt restructurings in 2005 and 2010 that were accepted by 92 percent of bondholders, has embarked on a smear campaign in a bid to soil the nation’s image, Kicillof said. The debt restructurings imposed losses of about 70 percent for investors who accepted.
Newspaper Ad
Officials at Elliott didn’t return a phone call seeking comment.
Kicillof today told reporters he was upset to have seen a full-page ad in today’s Washington Post picturing him and Argentine President Cristina Fernandez de Kirchner under the headline “A Model of Unsoundness.” The ad was paid for by the American Task Force Argentina, a lobby group partly funded by Elliott and other hedge-fund holdouts.
He said the hedge fund’s tactics were “mafia-like.” “The problem is not Argentina, it is not us,” Kicillof said. “It is the vulture funds.”
source: Bloomberg
“There’s quite a lot of focus on the industrial data out of Holland, France and Italy,” said Lyn Graham-Taylor, a fixed-income strategist at Rabobank International in London. Government bond buying by the ECB “is now our base case. We see quite a lot of room for decreasing yields.”
Germany’s 10-year yield fell two basis points, or 0.02 percentage point, to 0.89 percent at 5 p.m. London time. That’s down four basis points from Oct. 3. The rate touched 0.858 percent yesterday, the lowest since Bloomberg began collecting the data in 1989. The 1 percent bund due in August 2024 rose 0.17, or 1.70 euros per 1,000-euro ($1,264) face amount, to 101.055.
Rabobank forecasts the rate will slide to as low as 0.70 percent, Graham-Taylor said. Spain’s 10-year yield fell four basis points this week to 2.07 percent and touched a record-low 2.03 percent yesterday.
Output Stalls
French (GFRN10) industrial production was unchanged in August after growing a revised 0.3 percent a month earlier. The report came after separate data this week showed German exports, factory orders and industrial production each slumped by the most since January 2009 that month.
Portugal’s consumer-price index, calculated using a harmonized European Union method, was unchanged last month from a year earlier after dropping 0.1 percent in the 12 months through August. France’s 10-year yield was little changed at 1.25 percent after touching a low of 1.203 percent yesterday. It was one basis point lower in the week. The Portuguese 10-year rate was little changed at 2.96 percent after falling to as low as 2.918 percent. The yield dropped nine basis points since Oct. 3.
ECB Policy
Benchmark German 10-year yields have more than halved since the end of last year as ECB President Mario Draghi cut deposit rates below zero for the first time and unveiled a program to purchase private bonds. The decline indicates investors are unfazed even as Draghi differs with Germany’s Finance Minister Wolfgang Schaeuble over what further steps to take if the euro-area economy keeps weakening.
As the International Monetary Fund’s annual meeting in Washington began yesterday, Draghi again pledged to loosen monetary policy more if needed and called on those governments with the room to ease fiscal policy to do so. By contrast, Schaeuble warned against U.S.-style quantitative easing and urged continued budgetary discipline.
The five-year, five-year forward inflation-swap rate, which Draghi said officials use to gauge medium-term price-growth expectations in the euro area, slid two basis points to 1.85 percent, the lowest level since Bloomberg began collecting the data in 2004.
Growth ‘Ebbing’
“The growth momentum is ebbing away,” Ashok Shah, who helps manage $4.3 billion of assets as investment director at London & Capital Group Ltd., said in an interview on Bloomberg Television’s “On The Move” with Jonathan Ferro. “In Europe I think we are very near to a zero growth rate across the board, going towards deflation.”
Greece’s bonds advanced for a second day as Prime Minister Antonis Samaras puts his government to a confidence vote. Samaras has tabled the motion to head off an opposition challenge and win fresh backing for his plan to end international aid from the euro area and IMF.
The 10-year yield dropped three basis points to 6.60 percent today. Greek bonds are the worst-performing securities in the Bloomberg World Bond Indexes over the past three months, having lost 5.3 percent through yesterday.
Treasuries Set for Biggest Weekly Gain in Six Months
Treasuries rose for a fourth week, with 10-year yields dropping the most in more than six months, on speculation the Federal Reserve’s concern that global economic growth is slowing may push back interest-rate increases.
Yields on two-year notes headed for the steepest weekly decline since 2010 as the International Monetary Fund cut its forecast this week for global growth and European Central Bank President Mario Draghi pledged to loosen monetary policy more if needed. Traders see about a 33 percent chance the Fed will raise its benchmark rate by its July 2015 meeting, down from a 59 percent on Sept. 18, fed funds futures data compiled by Bloomberg show.
“The Fed changed the goalpost again,” said Thomas Roth, senior Treasury trader in New York at Mitsubishi UFJ Securities USA Inc. “Most of the move this week was on Europe and the dollar and the Fed’s emphasis of it in the minutes. We’re now data dependent on Europe.”
The benchmark 10-year yield was little changed at 2.31 percent at 12:57 0.m. New York time, according to Bloomberg Bond Trader data. The 2.375 percent notes due in August 2024 traded at 100 17/32. The yield has declined 13 basis points this week, the most since the week ended March 14. It touched 2.28 percent yesterday, the lowest in more than 15 months.
Bond Returns
Treasuries returned 4.8 percent this year, after losing 3.4 percent in 2013, according to the Bloomberg U.S. Treasury Bond Index. (BUSY)
The U.S. two-year yield was little changed at 0.45 percent. The yield has declined as much as 13 basis points this week, the most since the period ended May 7, 2010. A number of U.S. central bank officials said the nation’s expansion “might be slower than they expected if foreign economic growth came in weaker than anticipated,” according to minutes of the Sept. 16-17 Federal Open Market Committee meeting released on Oct. 8 in Washington.
Bank of America Corp. cut its year-end forecast to 2.75 percent from 3.1 percent, citing weakness in stocks, declines in market-based inflation measures and the strength of the dollar.
Yield Forecast
The 10-year note yield will end 2014 at 2.70 percent, compared with 3.44 percent predicted at the start of the year, according to the median forecast in a Bloomberg News survey published yesterday. The estimate is the lowest for year-end 2014 since Bloomberg began recording forecasts for the period in July 2013.
U.S. stocks slumped for a second day and the Standard & Poor’s 500 Index headed for its longest streak of weekly losses since January amid concern that slower global growth will hurt the economy. “Nobody can really say where the bottom of U.S. yields is,” William O’Donnell, head U.S. government bond strategist at RBS Securities Inc. in Stamford, Connecticut, one of 21 primary dealers that trade with the Fed wrote in a note to clients. “When investors are rushing out of risk assets (like stocks) to protect principal, they don’t dither over basis points. It’s all about return of capital right now, and not about return on capital.”
Bank of America Merrill Lynch’s MOVE Index, which measures price swings in Treasuries based on options, rose to 66.47 basis points yesterday, the highest since Sept. 16. The amount of Treasuries traded through ICAP Plc, the largest inter-dealer broker of U.S. government debt, was $525 billion yesterday after climbing to $563 billion on Oct. 8, the most since May 2.
Market Difference
The extra yield benchmark U.S. notes offered over their Group of Seven peers shrank to 0.77 percentage point yesterday, the least since Sept. 3. The spread between yields on 10-year Treasuries and German bunds narrowed to 1.41 percentage points yesterday, the smallest difference since Aug. 19. The yield on German debt due in a decade fell to a record yesterday.
Pacific Investment Management Co.’s $202 billion Total Return Fund, which was managed by Bill Gross until his Sept. 26 departure, cut holdings of government debt last month.
Pimco’s Total Return Fund, the world’s largest bond mutual fund, reduced holdings of government-related debt to 38 percent in September from 41 percent the previous month, data posted on the company’s website showed. The category, which is the largest portion of the fund, includes holdings of U.S. Treasury notes, bonds, agency debt, interest-rate swaps and inflation-protected securities.
The fund has returned 4.14 percent this year, trailing 59 percent of its peers.
Pimco to Barclays: Your Bond Index Is Hurting Investors
Barclays Plc is pressuring investors to hold expensive mortgage securities by filling its closely followed bond index with debt the Federal Reserve has been gobbling up, according to Pacific Investment Management Co.
The problem is that the Barclays U.S. Aggregate Index includes the $1.7 trillion of government-backed mortgage bonds that the central bank purchased to bolster the economy, Pimco money managers Mike Cudzil and Daniel Hyman wrote in a commentary posted on its website yesterday. Because those holdings represent more than a third of the entire market, they’ve limited supplies of the notes and inflated their prices.
The composition of the index -- which doesn’t include the Fed’s $2.5 trillion of Treasury holdings -- encourages managers of mutual funds and other accounts that use the measure as a performance benchmark to add the mortgage securities, according to Pimco, the investment firm that oversees almost $2 trillion of assets even after redemptions following last month’s departure of its star investor and co-founder,Bill Gross. “The inconsistent approach in the index is detrimental to investors because they are being asked to hold historically expensive securities that are limited in availability,” said Cudzil and Hyman, co-heads of Newport Beach, California-based Pimco’s agency mortgage-bond team.
Mark Lane, a spokesman in New York for Barclays, declined to comment. The bank, which is seeking to sell its index business to cut costs and shrink its balance sheet, announced Oct. 7 that its team managing the benchmarks had begun their annual process of reviewing potential changes and gathering feedback. The Fed’s holdings weren’t among topics asked about for mortgage securities, which focused on pricing issues.
Fed Pullback
While only a guide for their investment choices, money managers with specific mandates risk reporting abnormally poor performance when they stray too much from their benchmarks.
The Fed has been reducing its debt purchases and is on pace to stop adding to the holdings this month. At the same time, it said last month it plans to continue reinvesting principal payments to maintain the size at least until it decides to raise its target for short-term interest rates. The Fed doesn’t plan to sell as it normalizes policy, though may in the “longer run” dispose of a small amount, it said.
Many investment firms supported Barclays’s decision to include Fed-owned mortgage bonds in its index when the central bank announced its first purchases in 2008 because the program was envisioned as “temporary,” the Pimco managers wrote. An adjustment is now warranted because “the Fed’s rhetoric and apparent plans have recently changed,” they said.
Citigroup Index
Citigroup Inc. mortgage-bond analysts in August also said it might be time for benchmark bond indexes to exclude the Fed’s holdings, because the current set-up “forces money managers to buy the sector even if spreads are rich.”
The share of the debt in Citigroup’s own BIG index would fall to 20 percent from 29 percent with such a switch, its analysts wrote. The Barclays’s index also contains 29 percent. Amid the Fed’s buying, yields on mortgage securities backed by Fannie Mae, Freddie Mac or Ginnie Mae have fallen to 0.23 percentage point more than Treasuries, compared with an average of 0.59 percentage point over the past 15 years, according to Bank of America Merrill Lynch index data.
Domestic money managers have been reducing their holdings as the Fed made the debt expensive, owning about $150 billion less than what their benchmarks prescribe, according to estimates by analysts at Nomura Holdings Inc. The investors may start buying a greater share as the Fed stops purchases, they wrote in an Oct. 9 note to clients.
Cutting Exposure
Not all managers try to track the most-followed bond indexes. The $101.4-billion Vanguard Total Bond Market Index Fund (VBMFX) uses a “float adjusted” Barclays index that excludes the Fed’s mortgage holdings, according to its website.
Pimco’s own $201.6 billion Total Return Fund is 20 percent invested in mortgages, according to data on its website. The share in that category, which includes other securitized debt, fell to 19 percent in April, the lowest since 2010. “At Pimco, we are employing active management across our fixed-income complex, generally reducing exposure to the mortgage bonds that have been made the most expensive by the Fed,” Cudzil and Hyman wrote.
Argentina Has Financing Offers From Investors, Kicillof Says
Argentine Economy Minister Axel Kicillof said the country has access to financing from private investors two months after a legal dispute blocked the country from meeting its foreign debt obligations.
Kicillof, speaking at an event in the country’s embassy in Washington yesterday, said he has met with five or six investors interested in providing loans. While Argentina has no plans to accept the offers, Kicillof they show the country still has access to credit after a U.S. judge’s order prevented the nation from making payments on its overseas debt, resulting in its second default in the past 13 years.
The country hasn’t sold debt in international markets since its $95 billion default in 2001. After the U.S. Supreme Court declined to hear its appeal this year, Argentina has been blocked from servicing overseas bonds until reaching a deal with creditors from 2001 who sued for full repayment, led by billionaire Paul Singer’s hedge fund Elliott Management Corp.
“A fundamental quality to any ruling is that it can be complied with -- which doesn’t apply here,” Kicillof said. “No country would obey.”
The country’s benchmark bonds due in 2033 slipped 0.45 cent today to 82.43 cents on the dollar as of 1:09 p.m. in New York. Elliott, which refused debt restructurings in 2005 and 2010 that were accepted by 92 percent of bondholders, has embarked on a smear campaign in a bid to soil the nation’s image, Kicillof said. The debt restructurings imposed losses of about 70 percent for investors who accepted.
Newspaper Ad
Officials at Elliott didn’t return a phone call seeking comment.
Kicillof today told reporters he was upset to have seen a full-page ad in today’s Washington Post picturing him and Argentine President Cristina Fernandez de Kirchner under the headline “A Model of Unsoundness.” The ad was paid for by the American Task Force Argentina, a lobby group partly funded by Elliott and other hedge-fund holdouts.
He said the hedge fund’s tactics were “mafia-like.” “The problem is not Argentina, it is not us,” Kicillof said. “It is the vulture funds.”
source: Bloomberg