Wednesday, January 04, 2006

An interesting move 

In an interesting move that I'm not sure I fully understand Venezuela sold 600 million dollars of the Argentinian bonds it had bought to help the Argentine government to private Venezuelan banks.

They didn't give any details (such as how much money the government made on the transaction) but this sounds to me like the Venezuelan government is no longer on the hock for these bonds. That is, if Argentina were to default it would be the Venezuelan banks that would be at risk, not the Venezuelan government. That was always the primary concern of the opposition about this transaction, that Venezuela was taking a big risk with its money, and hopefully this should at least partly remedy it.

Hopefully, more details will be forthcoming on this.


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