Coleman Church

um probably stark examples recently would be argentina um and uh you know right now ukraine will be pretty significant one as well see what the workout is with that

Not on a military level, but... Ukraine is a different one than, say, in Argentina because it has, at the moment, more of a geopolitical put, so to speak, than pick a random country like Bolivia or Argentina.

Yeah.

Although now under this administration, clearly there's more, with sort of Monroe Doctrine Part 2, there's more of a geopolitical put to Argentina.

But Ukraine's a tricky one because there are, obviously, up until recently, you had the entire West behind them, right?

And there's...

This week alone, you've got Larry Fink, Witkoff, and Kushner over there working on stage two, what's going to happen, the peace process, but also the rebuild.

So it's an odd one.

I think that's going to be a combination of public and private because there'll be so much rebuild to do and there'll be a lot of money to be made in the rebuild.

Well, a debt crisis typically is not a debt crisis alone.

It's accompanied by a currency crisis, the debt crisis, the external debt, and then a local market interest rate crisis, which is also debt in itself.

So the local T-bills, local interest rates will skyrocket at first to try to raise interest rates, to try to attract investors.

money to the currency to stem the route on the currency.

And that can work up until a point until you lose control of both.

So what a debt crisis looks like is currency, runaway currency devaluation, runaway higher interest rates, which clamps down, the interest rates clamps down any lending locally, clamps down any local growth, creates defaults on domestic businesses.

uh the currency running away depending on the country but all countries it causes inflation but uh countries that rely on imports certainly even more right everything you're bringing in um is going to cost far more in your local currency um so it's really a spiral um and then current typically what happens is bonds will drop to a level that's called recovery value

And recovery value is effectively what is a term really more from, say, the corporate credit markets where if you were to strip everything down and sell it for parts, what could you get for the cash value?

Because no one can function without borrowing.

No one can function without debt.

So if you can't borrow, you can't exist.