Yesterday, I did a blog entry explaining how hedge funds are driving Greece into the ground because they are making money stripping Greece to the bone. Greece is trying to get a deal where the hedge funds will take losses, otherwise it will default in March.
Now we have a news report that hedge funds are planning to sue Greece and force it into making bond payments. The funds are planning to go to the European Court of Human Rights and argue that that Greece has violated bondholder rights, though that could be a multiyear project with no guarantee of a payoff. The funds are looking to do it because Greece is considering passing legislation to force all private bondholders to take losses, while exempting the European Central Bank, which is the largest institutional holder of Greek bonds with 50 billion euros or so. Legal experts suggest that the investors might have a case. If Greece changes the terms of its bonds so that investors receive less than they are owed, or don't get paid at all, that could be viewed as a property rights violation. In Europe, property rights are human rights.
Sill, the Greeks are sticking to their guns. As reported here, Greek Prime Minister Lucas Papademos has threatened to force hedge funds to accept the losses by law if a deal cannot be reached. If they don't agree to a deal, he says, he'll pass legislation forcing them to take the losses. In the end, it could be the courts that decide what happens to Greece.
no comment untill now