RE:RE:RE:JUST OUT BY WASHINGTON POSTClearly Venezuela won't be able to make good on 150 billion in unpaid debts to an endless list of parties. It is interesting that your calculation of 'ten cents on the dollar' is the discount that Rusoro's market cap is currently trading at in relation to the settlement offer of 1.2 billion
The argument for this play is that a 1.2 billion debt to rusoro will be prioritized as the regime attempts to get the mines into production and get some desperately needed gold revenue. Since the regime is on the hook to it's chinese and russian strategic allies, and since china and russia are largely there for the oil and the gold, we are sitting here hoping that russian and chinese financing might come through - as key russian and/or chinese investors will hope that future years' gold revenue can be used to pay off their loans. The most clever post I saw on this board was somebody saying they hope china is printing the money right now to pay this settlement. That is my hope as well.
Like every gold speculation, it's a play based on the special power of gold as hard currency. In this case the play involves way more uncertainty and political risk than usual.
I am very open minded about this play, dealing with the Venezuelan state is obviously an almost comically high level of jurisdictional risk. But I had high risk appetite for a speculative play, and if we're lucky we might get outsized gains and experience the 'risk premium.'