Mision Wall Street

September 29, 2004

So, Venezuela issues US$ 1.5 billion in a ten year bond in cash and exchange deal with a coupon of 8.5% and a price of 95%. This implies a yield to maturity below Venezuela’s Global 27 bond which is thirteen years longer. The new bond immediately jumps to between 98-99%, the yield settling to where it should be in the country’s curve, giving a tidy profit to those that participated in the deal, particularly the cash part. The deal had changes in deadlines such that some people were left out. Should I think there is something funny about it? Nah! Just the robolution trying to please Wall Street investors. There could never have been any inside information, no way!

What should we call this: Mision Wall Street?

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