New Greek bonds lose 50%!

The prices of the new Greek government bonds move at a very low level, while a bond of 436 million euros was paid to a vulture Fund, for which Papademos’ government insisted that it would not be paid as it was not included in the PSI in time.

After the failure to form a government over the past two days, the Greek bonds dropped to low prices. The ten-year bond that was to end in February 2023 had a value of 15.10 and a 26.24% yield.

It is characteristic that apart from the Athens market, the Greek bonds are also traded in the German market in Stuttgart. Yesterday the ten-year bond showed a 507,000 mobility. Similarly, the bond that ends in February 2024 has a price of 14.54 and a 25.09% yield. Correspondingly, the bond that ends in 2026 is priced at 14.06 and has a 24.03% yield.

As experienced bond managers stressed, this will whet the appetite of new vulture funds that will follow the tactics of the American billionaire Kenneth Dart.

Since the markets are betting that Greece is likely to proceed to a new restructuring, they can buy low now and take advantage of new circumstances where the country will not want to declare a default, and get paid in the end as was the case with the Dart Fund.

The Dart Fund of the Cayman Islands bought Greek bonds at prices of 50-60 cents and eventually got paid at 100% of its price, that is $1. It is obvious that this specialized fund was buying Greek bonds during a period long before the debt restructure. Then, even if the Greek government would not pay the bond, the Fund would have sued Greece as it did with Argentina, claiming $2 billion against the debt it had purchased.