Wednesday, May 18, 2016

The "Trillion-Dollar-Mistake" -- It May Be Worse Than "We" Think -- May 18, 2016

Bloomberg is reporting:
Saudi Arabia has told banks in the country that it is considering giving contractors IOUs to settle some outstanding bills.
A projected budget deficit this year is prompting the government to weigh alternatives to limit spending. Contractors would receive bond-like instruments to cover the amount they are owed by the state which they could hold until maturity or sell on to banks.
Contractors have received some payments from the government in cash and the rest could come in "I-owe-you" notes.
"It" may be worse than we are being led to believe. More from the story:
The government started delaying payments last year to prevent the budget deficit from exceeding $100 billion after the oil slump.
Deputy Crown Prince Mohammed bin Salman told Bloomberg News in an interview in March that authorities have started paying companies back.
Note: it was back in March, 2016, that it was reported that the Saudibinladin Group was struggling due to low prices (see below).

The picture becomes a bit more clear why Prince Salman needs to launch a Saudi Aramco IPO, albeit, incredibly small.

I track the Salman Plan here.

The big dots that now connect, in the chronological order they appeared:

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