by Wolf Richter
But who are the suckers?
It’s now happening again. And the deal was made today. The playbook goes like this: Argentina and Wall Street investment banks decide to sell Argentine bonds denominated in dollars, euros, or Swiss francs. The banks underwrite those bonds and promote them and sell them to investors, such as bond mutual funds and life insurance companies or even individuals. It works for everyone: The banks get the fees. Argentina gets the proceeds in hard currency. And the suckers get the bonds.