<<One could say that these loans are actually equity investments by the Korean Govt and not actually debt.>>
Oh please, where is this, never, never land??? Korea's external short term debt (due w/in year by defin.) is currently estimated at 100bil, and rising. According to S&P and Moodies, who in the middle of the week took the almost unprecedented step of lowering the major bank credits of Korea from upper middle investment grade to the notch immediately above junk.
Reason being newly disclosed info. Korea is all but being publically accussed of massive lying. Those are the facts, my friend. Privately, they are being accused of lying.....or of intentionally being hyper misleading to the IMF and everyone else at the moments of crisis when one would think candor and trust building takes precedence over everything.
Based on the above, I am quite sure it is considerably worse.
If you read the inside pages of the NYTimes on Korea today, you will find open estimates that despite the IMF 58 bil (and assuming no further repudiation of living by its terms by the Koreans) that there is a 50/50 chance of a default. (Which will mean debt restructuring, much higher borrowing costs, and major requirements for advancing ANY further credit.)
Korea is gonna get a disgusted reception if any attempt is made to go to congress. Their behavior has simply not been honorable. Its been go for mine, lie to you, give me money, you're too scared to let me fail.
Rubin has signalled he isn't too scared. This is shaping up as drama.
And I can tell you the more that Congress, US press looks the less the y are gonna like Korea's total ingrate, total recalitrant position. Fireworks coming.
Doug |
