Argentina May Defy NY Courts With Payment Offer With just hours to go before Argentina has to show its last cards in a billion-dollar debt showdown in the U.S. courts, President Cristina Fernandez seems to be keeping up her "we're going for more" motto. Her government is reportedly preparing a response that analysts say could lead the country into another catastrophic default. Argentina has until midnight Friday to propose how it would satisfy a $1.4 billion judgment won by plaintiffs who have insisted for a decade on getting full payment in cash, plus interest and penalties, on sovereign debt that the country hasn't paid since its world-record default in 2002. Government officials weren't talking in public about the plan this week, but they have repeatedly said that the plaintiffs it considers "vulture funds" should get no better than what 92 percent of other investors in Argentina accepted in 2005 and 2010 in exchange for their defaulted bonds: a package of new bonds that were initially worth less than 30 cents on the dollar. The exact details likely won't be known until just before the deadline, but the broader aspects have been widely reported in Argentina's media: Rather than the quick cash payout ordered by the courts, it will offer new bonds that won't come fully due for up to 35 years. And rather than pay in full, the government will insist on paying no more than 30 percent to start with. FILE - In this Aug. 2, 2012 file photo, Argentina's President Cristina Fernandez speaks at an event marking the 158 anniversary of the stock exchange in Buenos Aires, Argentina. The South American country has until midnight Friday, March 29, 2013 to propose how it would satisfy a $1.4 billion judgment won by plaintiffs in U.S. courts who have insisted for a decade on getting full payment in cash, plus interest and penalties, on sovereign debt that the country hasn't paid since its world-record default in 2002. Fernandez's government is reportedly preparing a response that analysts say could lead the country into another catastrophic default. (AP Photo/Eduardo Di Baia, File) Close If true, this would amount to open defiance of the U.S. federal courts, Wall Street analysts say. Argentina could keep appealing, but the U.S. Supreme Court has a long record of denying such cases. And that could be "suicide" for the South American nation's economy, says financial analyst Josh Rosner, managing director of Graham Fisher & Co. in New York. The court was looking for something simple, like: we're not going to pay them in a lump sum, but we're going to make a quarterly payment of the full $1.4 billion over three years. They weren't looking for creative financing where Argentina demands or forces a new bond," Rosner said. What if somebody took that new bond, and the Argentine government defaulted the next day? Analysts voiced similar worries in Argentina, where defying the "vulture funds" is politically very popular, but economically dangerous. If the government loses, "Argentina will be forced to decide whether to follow the decision or enter into technical default, a situation that would increase the country risk and deteriorate even more the price of publicly traded shares, as well as drive the parallel dollar even higher. This is not the most auspicious moment to run these risks," economist Ramiro Castineira concluded after analyzing how the government might follow through on its position. The appellate court already ruled in October in favor of NML Capital Ltd., a hedge fund run by billionaire Paul Singer, basing its decision on the "parri passu" clause in the defaulted bond contracts, Latin for treating all bondholders equally. Fine, Economy Minister Hernan Lorenzino has said repeatedly during this appeal: equal means Argentina will pay the plaintiffs no better than what the exchange bondholders got in 2005 or 2010. Those bondholders have been steadily repaid, recovering much of their original investments over the years. But Argentina is apparently going to insist that the plaintiffs start with no more than what the other bondholders started with years ago, not what they've been paid to date, Castineira said.