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Norway protesting PSI losses

Posted by WARREN MOSLER on May 8th, 2012

>   
>   (email exchange)
>   
>   On Tue, May 8, 2012 at 10:21 AM, John wrote:
>   
>   Norway’s oil sovereign wealth fund has sold all its holdings of Irish and Portuguese
>   government debt and reduced its ownership of Spanish and Italian bonds as part of a
>   continuing protest over its forced participation in Greece’s debt restructuring. The
>   fund also reduced its Italian sovereign debt position from about EUR 8bn in the middle
>   of 2011 to about EUR 3.5bn at the end of March this year.
>   

9 Responses to “Norway protesting PSI losses”

  1. Neil Wilson Says:

    Diddums.

    And what has it done with the Euros? Put them in a bank that then bought the bonds back?

    Reply

    walter Reply:

    @Neil Wilson, They added govt bonds from emerging mkts such as mexico, brazil and india to their portfolio.
    Doesn’t mean necessarily that they dumped euros, but likely.
    Looks like that Norwegian sov wealth fund just grows, grows and grows….:) but OK oil is coming down at the moment.

    Reply

  2. walter Says:

    This Norwegian protest looks to me as a very strong signal that with norwegian govt bonds in NOK you do not need to fear any PSI, haircut, no matter which self imposed restrictions they have.

    Reply

  3. PZ Says:

    Why do they buy goverment bonds anyway? Yields are lowsy compared to other forms of investments.

    Reply

    FIN Reply:

    @PZ,

    risk-free…except for the ocassional psi losses

    Reply

    FIN Reply:

    @FIN,

    massive ones at that

    Reply

    roger erickson Reply:

    @FIN,

    risk-free? there’s no risk like letting progress go by;
    or uncertainty, for that matter :)

    Wasn’t there a biblical story about the Prodigal Sum?

    Reply

    WARREN MOSLER Reply:

    fair value on a risk adjusted return basis, by definition

    Reply

    roger erickson Reply:

    @WARREN MOSLER, that’s a clever acronym for hibernation;

    works for some, if you can bear the pace of mold & still grin;

    Reply

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