TY  - JOUR
AU  - Garber,Peter M.
TI  - Alexander Hamilton's Market Based Debt Reduction Plan
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 3597
PY  - 1991
Y2  - January 1991
UR  - http://www.nber.org/papers/w3597
L1  - http://www.nber.org/papers/w3597.pdf
N1  - Author contact info:
Peter M. Garber
Deutsche Bank
60 Wall Street
New York, NY 10005
Tel: 212/250-5466
Fax: 212/250-2628
E-Mail: peter.garber@db.com
AB  - In 1790, Alexander Hamilton, the first Secretary of the Treasury of the United States, initiated a program to refund the U.S. debt. Debt that had sold at 75% discount two years earlier would be refunded at par into new funded debt of the new federal government. All foreign indebtedness would be repaid. I present evidence that Hamilton's actual refunding policy did not differ in nature from that envisioned under the recent Brady plan. I will show that the bond package for which the old debt exchanged had a market value well below par. Thus, a large part of the face value of the debt was effectively written off. I compare the Hamilton restructuring package to the recent Mexican restructuring package to find points of similarity to the Brady plan.
ER  -