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Argentina's Paris debt volte face

Randazzo practising arm movements for happy
hour at the Irish Pub Friday

Just a few weeks ago, Argentina was going to pay its 6.8Bn debt to the Paris Club group of nations, the world applauded, Klishtina trumpeted the strength of the local economy in the face of international adversity and blew fat razzberries at Lehman Brothers as it went belly-up.

Today, Interior Minister Florencio Randazzo admitted that the gov't was reconsidering the Paris Club payback, and the operation may be indefinitely delayed due to "unpredictable" nature of the financial crisis. In the words of Randazzo (translation Otto):

"At the moment it's something we are analyzing. We have made a commitment and commitment are to be fulfilled. In any case, we are negotiating with the Paris Club to determine exactly what is the debt and how it is to be paid."

If you're not aware, "negotiating" in LatAm politikspeak means "drag this sucker out as long as possible". So the very same gov't that was laughing at the North's predictament just days previous are now officially crapping themselves. And well they should, with country risk over 1200 basis points and BODEN dollar bonds under 40c to the dollar. Nobody but nobody wants to lend money to Argentina right now and with plenty of debt to roll over, they may well need every penny of the $50Bn tucked away in the Central Bank to get through this mess.