Today Zambia will default on a coupon and become the first African nation sovereign default due to Corona virus You may say how does that effect me, I’m not invested in that junk Remember the sub-prime crisis of 2007?
They can blame Covid, but most have been fiscally mismanaged for decades. Remember their neighbor Zimbabwe? "Covid" is a politically expedient thing to blame the politicians own failures on.
Interesting. I have a few Zambian coins. I like the animals. I jut pulled this off the BBC article: "Sarah-Jayne Clifton, director of the UK-based Jubilee Debt Campaign, which is calling for debt relief for the world's poorest countries, said creditors lent to Zambia at high interest rates knowing the debt would probably become too great. "That risk has now materialised, and bondholders must now accept a significant debt write-down," she told the Reuters news agency this week." Looks like most of Zambia's loans came from China. This is the kind of stuff that is going to happen even more in the near future, especially in Africa. Chinese money is all over Africa.
This seems like a definite "progressive" trend, blame the people lending money. Did these lenders put a gun to the President of Zambia's head and told him to take their money? All across the world, the same excuse is being used, "aggressive lenders got them in trouble", etc. How is the WORLD is a lender to BLAME for when a borrower agrees to borrow the money and then doesn't? I can see loan sharking, with weekly vig being overly burdensome, but national debt with interest usually below 10%, and its the LENDER's fault? Same is being said of US credit card loans, or car loans, etc. To progressives, its the banks fault for lending the money. That is like blaming the butcher for you being fat.
Oh, I'm not saying it isn't the government of Zambia's fault. They, along with a lot of other African countries' leaders are corrupt and have no problem stealing from the country's coffers. That being said, countries, namely China in Africa's case, come in with all this money to throw at developing countries who most of the time can't afford to pay back the loans. It reminds me of loan sharking. Then China swoops in and takes over whatever stuff that money was put towards, ports, industries, etc... I think it is on both parties, the governments of these nations, and the predatory lenders. Both sides are shady and it is the common every day populace who suffers for it. It's a shame.
But it gives jobs to the professional hand-wringers like "Sarah-Jayne Clifton, director of the UK-based Jubilee Debt Campaign" Sarah-Jayne Clifton – Director Since 2013 Sarah has managed the staff team and overseen the running of the organisation, alongside work on specific projects and campaigns. Previously she coordinated Friends of the Earth International’s climate justice and energy programme, and for Friends of the Earth; lead on corporate accountability and trade, plus climate finance. She has a Masters in International Politics. Well, well a masters in talk talk!
I don't see this as a difference in kind, just in degree. I don't work in finance, but I have to imagine that it's a loaner's job to decide whether the interest a loan generates is worth its risk. Part of that calculation has to include the possibility of catastrophic events. COVID has certainly been a catastrophic event. But it also has to include the perceived trustworthiness of the borrower.
Yes, but that calculation is made assuming existing rights to property, laws in place enforced, etc. "Progressives" are trying to change the rules of the game, remove key facts that were in place and assumed when such a calculation were performed. If you would have told the lenders before they lent the money that progressive politicians would remove many rights of the lender, then most likely the loan would have never been made. People would NOT have houses, cars, etc they have now. That is the problem. You can do this ONCE, steal from lenders, but going forward they will calculate that into their decision and millions of people in the future will NOT get any loans. Their life will be much worst, but the progressives will pat themselves on the back for all of the "good" they have done while many more people suffer.
I disagree with a couple of your fundamental assumptions, but this isn't going to be the venue to discuss them. For starters, while "progressive" is apparently still not a red flag here, I can't think of a term for "the other side" that wouldn't get my comment immediately flagged as political. And any discussion of "progressive" vs, well, anything is fundamentally a political discussion, isn't it?
As my daddy said It doesn’t matter how you got to the middle of the bridge if you go over the railing
Wait a minute... you mean you can't file bankruptcy four (4) times and still come back for more unless you are the opposite of "Progressive"?
Then you name the group that advocates debt forgiveness, wants to prohibit collecting rents on rental units but still subject landlords to taxes, etc, or change the payments on mortgages after they are made. I am not interested in names, but the policy they advocate.
I don't know much about African nations, but countries in South America had companies come in and create jobs to work in the mines or oil fields and when the leaders of those nations see all that money leaving their countries, they nationalize those industries, but then they mismanage them and the businesses go under because nations like China, Russia and the United States companies don't want to get bit twice by crooked politicians. Just look at Venezuela.
Quite right. I guess my point was many of these nations have defaulted in the past, will default today, and most likely default on whatever money you loan them in the future. Western nations had the habit of "restructuring" and forgiving debt over and over, but the Chinese have not. They repossess, like the port they took over in Sri Lanka. I think it will be a wake up call for these nations used to having the money cleaned away.