>Am I wrong in thinking that Russia's agreement with the London Club is a
>vindication of Daniel Davies' argument last month that defaulting on
>investors, properly handled, will induce them to write off a major portion
>of your old debt?
Russia is a special case - 27,000 nuclear weapons and all. If you're small & weak, you'd have a much harder time going it alone.
> And that they will still let you back into the capital
>markets in a short time?
The memory of the capital markets is greatly exaggerated.
> It's also interesting that this agreement with
>private creditors seems to be putting pressure on governments that lent to
>Russia to be less hardass. (Is the Paris Club always more hardass than
>private creditors? I notice they seem to be plenty hardass on Nigeria
>these days as well.)
The FT article on Russian debt restructuring said it's very unusual that the London Club (bankers) would act ahead of the Paris Club (governments). Official creditors are much less likely to write off debt - the WB and IMF go to great lengths to say they never restructure or forgive, which sometimes requires rhetorical and accounting contortions.
Doug