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To: Janice Shell who wrote (357)	8/1/1999 9:33:00 AM
From: celeryroot.com	Respond to of 640

Do you think there is any possibility that good old Alfredo has ever been to Saipan???

To: Janice Shell who wrote (357)	8/1/1999 3:22:00 PM
From: Henry Volquardsen	Read Replies (1) \| Respond to of 640

great story <g> they pull the same tricks on an international level. Some of my favorites involve the bond market (naturally). Back in the 80s there was a very popular tax arbitrage on Italian gov't bonds. The Italians imposed a withholding tax. Because of the tax the bonds had high yields. However there were a number of tax treaties that the Italians had, particularly with the EU, that allowed exemptions from the withholding. If you were exempt you could swap out into the currency of your choice at very attractive yields. The problem was getting the Italians to actually refund the withholding. A large non-EU (at the time) Treasury decided they wanted to do the trade. Being a bit skeptical of the Italians they decided to enlist the support of one of Italy's EU partners. Together they went to the Italians and structured a deal and got written guarantees. The deal got done and 6 months later it is time for the first coupon payment. The payment arrives and lo and behold the tax has been withheld. Enquiries are made and the response came back that there had been some changes in government and they no longer agreed with the exemptions. The arguing went on for years before it was resolved (meanwhile the Italians had an interest free loan). There are dozens of others <g>