Tuesday, February 21, 2012

THE BELIZE SUPERBOND - think about it ? -

Caye Caulker, Belize. The site for a Central American world shaking conference on the BELIZE BONDS ISSUE. Don´t think too hard though, life still has to be lived and enjoyed here in PARADISE.


Iceland was held up as an example by a discussion group on Caye Caulker early this week, on debt restructuring.
Iceland was pressured by the populace of that small country ( they stoned the HOUSE, where government ministers were meeting and wanted guilty banks to fail, during the last recession ).
Iceland is doing well, with GROWTH expected at 2.7 GDP this year, while the European Union has less than 1% GDP expected. In Belize we expect over 3.1s % GDP for comparison.
Iceland let the banks FAIL during the recession and what they did, is took the BANKRUPT banks over and made them into STATE BANKS. They then seperated the savings accounts of all ICELANDIC citizens, from the rest of the tangled mess in the bankrupt banks, and let FOREIGN DEBTS and CREDITORS go hang themselves in bankruptcy. The USA does something similar with Federal Bank Insurance. Icelanders kept their savings accounts now in the NEW State banks. Since all the failing banks were involved in the US DEBT SWAP real estate debacle, the mortgages were wiped out by the bankruptcy proceedings. Icelanders suddenly found they owned their houses, free and clear. Since then, the ECONOMY has boomed. Never been better, they say.
One of the cute things they did was pass LEGISLATION, making it ILLEGAL for the ICELANDIC GOVERNMENT TO PAY ANY FOREIGN LOANS INTEREST, in FOREIGN EXCHANGE. Such interest payments on foreign loans had to have the interest paid and accepted in Icelandic KRONER. The local currency.
This Belizean discussion group, wondered how that would help us in Belize? Well since our FOREIGN MUSA/FONSECA super bonds are in foreign currency and have to have their INTEREST PAYMENTS, paid in foreign currency. Such a law would change the dynamics of the MUSA SUPERBONDS, when the interest payments had to be paid in BELIZE CURRENCY instead, by law.
Speculation in the discussion group, had it, that changing FOREIGN LOANS to interest payments in Belize Currency, would stimulate investment of a pile of millions in the hundreds of millions, into the country of Belize. As you cannot easily exchange Belize currency into foreign money. The other thing, was that FOREIGN LOAN AND BOND HOLDERS, would likely want to get rid of their BELIZE SUPERBONDS and the cascade of SELLING on the LUXEMBURG EXCHANGE, would enable the government of Belize to buy back the BONDS at pennies on the dollar. They are already trading less than .40 cents for the dollar. Some could be bought by Belizeans also on the Exchange and then the interest payments of those BONDS not bought by the Government of the DAY, in private Belizean sector hands, would undoubtedly boost the local economy, as private local investors ended up re-investing in Belize with their interest payments.

The President of Guatemala has suggested such ideas are wanted by the Central American union, to develop the economies of our linked seven countries.
- think about it! -

Then you could concentrate on more pleasant things. Like this sunrise on Caye Caulker at 6 a.m. on a February morning in 2012. Caye Caulker mottos are GO SLOW. Or, NEVER DO TODAY, WHAT YOU CAN PUT OFF UNTIL TOMORROW.


Maria Mercedes said...

Belize banks are already awash with money. Proof: TBills in Belize yield less than 3% which shows an ample supply of money that Belize banks have.. Use a part of the proceeds from these low yielding Belize TBills, and from the reserves of Belize banks, to buy a piece of the Superbond.. In the process make it easy for Belizeans to buy the superbond as an alternative investment. Belizeans who are tired of receiving so little interest from banks for their hard earned money would then have the option of receiving a higher interest rate and in US dollars, which they could then use as they see fit- including buying Belize dollars and stimulating the local economy.

Maria Mercedes said...

By the way, it is necessary that Belize banks buy a piece of the Superbond, so they can divide it up, and easily sell it to Belizeans in small amounts. Thus greatly facilitating the buying of the bond within Belize, which is the main problem right now.

A Professional BEACH BUM retires in Belize! said...


I tried a couple of times over the past few years to buy a $100,000 Bz with my savings of treasury bills, but could never find out from Central Bank what the last auction rates were? They phoned me and simply evaded all enquiries as to what the treasury bills were going for at auctions, so I was unable to guage the return for my savings, vs bank CD rates. I drew the conclusion the game was rigged in favor of politically connected Belize banks and decided to forget about it and have since some three years later, this year, opened my own JAGUAR CAPITAL MANAGEMENT account operating in the USA option markets. Can´t do business here at home, then bloody well go someplace where they like to collect the taxes and other benefits.

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