What are Ginko Bonds worth? - 2

The face value of the Bonds is 1L

It is 1L becuase it is with this justification he CONVERTED everyones accounts to bonds.

He converted them on a 1 to 1 trade so that your Account balance equaled the FACE Value of the bonds.

The face Value is only the face value becuase of two things.

1) Its what Ginko said the Face value was thus justifying the conversion
2) Its the value that the Dividends are caluclated from.

Of course the Trading value Has never reached the supposed Face value - I get that. Nick P flatly refused to convert bonds to account holders for the trading value before the split. He insisted they had to pay FACE VALUE.

The Split was just accounting. The old face value was 100L the new face value is 1L there is no difference becuse he did a split on the 100L bonds before he changed to the other value.

The Market Value is whatever people will buy the bonds for , it has NOTHING to do with face value.

Now that the conversion is done face value only matters for two things.

1) Its the value used to calculate the Divident payment (interest)
2) Its the Value WSE has stated as the Minimum Ginko can buy the Bonds for.

Basically WSE is forcing Ginko to honor the face value they claimed when they issued the bonds.

This is only RIGHT becuase thats the amount of money Ginko Owned.

Will the Bonds ever become 1L each? Who knows. Would be ncie for those stucck with heaps of these Bonds.

However Logically they Bonds wont be worth 1L each until Ginko convinces Potential Investors they have Assets equal to the value of the bonds (approimately 190 Million L, of which only roughly 50 million has been disclosed as SL assets)

Which will be tough becuase Nick P. Doesnt want to disclose what he invested the money he got in.

In fact its quite obvious why the starting value of the bonds was around .26 cents (or $26 before the split) since that ~25% represented the SL disclosed verifyable assets.

As people sell off and confidence declines, Prices drop. If Confidence improves prices will go up.

It is entirely possible the ~50 Million in SL is the BULK of Ginko's assets that remain. It might be more of course , however, Nick isnt being very forthcoming in that information.

After all this it strongly resembles a clasic Ponzi Collapse. with no explanation of where all the supposed money is. The big difference in the real world when this happens it involves handcuffs and jail. Instead were getting a peak of how Ponzi operators would try to flim flam their way out from under their debt.

Remember Nick's original plan was to BUY up these Bonds at BELOW the 1L face value and retire large portions of the debt that way. WSE prevented him from doing that. Becuase literally that would be Ginko admitting and profitting from the fact the 1L bonds are not worth 1L.

Technically the 1L bonds should be worth 1L becuase they represent 1L worth of Invested Assets that Ginko supposedly has.

So we are left where we are today with the Bonds trading for 10% of the Value Ginko claims they represent.

The fact sellable value of the bonds have dropped bellow even the Disclosed assets of Ginko is very discouraging. It basically means that Most bond holders and potential investors currently beleive Ginko has no intention of liquidating its assets to pay its debts. EVER.

Now for those who have had trouble following all this - theres a reason for that. Ginko doesnt WANT you to be able to follow it all. Becuase then its obvious how bad things are.

This is like a shell game. Several posters have their eye on the wrong shell.

its 1L becuase thats how much DEBT ginko converted for the Bond.

its Ginko that claimed the face value to be 1L

Its trading value is seperate from that - Gee even Nick SAID as much.

okay i'm going to post to this one your arguing the definiation with me and its not me you have to argue with its nick and the fact of the matter is since he called his "thing" a bank and then changed his minds and simply used the word perpetual doesn't mean that it is. (well it is in the sense that he will never ever buy them back he used them as a way to dump a debt).

He posted their face value and stated it as such and he said he was going to buy them back eventually although that's pure speculation as to when
He gave people a so called choice and said they can wait for him to buy them back at the full face value (which if its nick is probably never) or sell them on the open exchange and take the loss (his words not mine) and forget he ever existed.
He assigned a percentage of interest to them and a maturity date was calculated by several people

So your argument is with him not with us or what you feel they should mean. Its what he stated at the time and so one has to take that as "fact" even though its a boldfaced lie because that is what it is.

so anyhow you doubletalk like nick so i will just leave it at that....

Think of these bonds more like an IOU

for every 1$ You had in the bank Ginko gave you an IOU for 1$

They said they dont know when they will be able to give you 1$ for the IOU - but in the meentime they will pay you interest on that dollar they owe you.

Now theres people who will buy your IOUs off you. But they wont give you a 1$ they will only give you 10 cents.

SO you can either keep your IOUs, hope you get that interest on them, and hope someday someone will give you closer to 1$ for it.

Or you can sell your IOUs to somebody for 10 cents each.

That is, "I OWNED U".

Id like to point out for the wikipedia and dictionary people


Im using GINKO's definition of Face Value.


I find it nearly imposible to believe the Ginko supporters are arguing with me since the Ginko definiton of the face value is the only link between these bonds and how Much money they are owed.

Exactly what or where do you think I'm being so evasive about this? I know, you won't answer just like someone else here.

No one here seems to be able to argue against the fact that the bonds converted to a face value of L$0.26.

But Colette, you are correct. People forget that the bond is actually a debt, and that debt is the amount upon which interest is calculated. This is the nominal/face value. Nick isn't paying interest based on .26 of the debt he stole...erm borrrowed - he's calculating interest based on the amount of each bond's face value, which is 1L. The only problem, which we all understand, is that there IS NO maturity date. But this is not something to get wrapped around the axle about - the point remains that Nick owes people 1L for every bond he issued, and owes them a certain amount of interest quarterly as long as they hold the bond. If they hold their bonds for 8.5 or so years, they will have obtained the full amount of the principal back assuming that the dividends were properly paid, and then they are free to sell the bonds without taking a loss. Selling them to him or anyone else prior to then will most certainly result in a loss. How deep that loss is, no one knows, but right now, that's 90% (if you were a converted depositor).

Did you even read what I wrote? lol

I'm not going to answer you.

Looks like you are actually agreeing with me there. I seriously wonder how (or truly why) you say I'm so twisting on this.

In RL, you can't easily cash-out perpetual bonds as the WSE allows you to do. If you do as easily as WSE allows you to do now, you will take a loss, yes.

The interest/dividend rate is how a perpetual bond is valued. If NP doesn't make a single divend/interest payment, the bond is immediately worth nothing. Until then, it is worth more than %10 (or 10 cents).

Do we have a count-down ticker?

It's very simple. Pay attention now. Each bond is redeemable BY NICK for 1L per bond held. Each bond, however, may be traded for less than that. As far as Nick, the issuer, is concerned, he owes 1L. Not .26L per bond. Not .098L per bond.

Face value != trading value.

Yes. Now, answer my question instead of avoiding it. lol

Dzonatas, you make a big issue out of the term "face value" and seem to want to make it into something it is not, and that something inflates the value of the bond when it should not.

The actual value of the bond is a tricky thing. I think it is worth next to nothing, because I don't expect it to pay its dividends as promised, based on what I have observed and what I know about Ginko's inworld investments. This is a YMMV situation, because you may see it differently.

To a shark, the bond is probably worth more, because he is looking for market arbitrage - he is not looking to actually redeem the bond. But to a bondholder, it represents much more because that is their money - although the older GPB holders now effectively got their 1L redeemable bond for .25L on the L$.

It might be a good time to buy, if you are brave, if you think the bond will go back up to trading around .17 or .2.

eh look up

these are not just "bonds" and cristale has it outlined. He didn't sell them or anything he just used them as a way to dump debt. Presently they are trading according to you for .26L or if you read collette's post 0.10L.

So the present value of the bonds is whatever it is today if you want to call it face value that's fine but most people are talking about the face value it was given when they were umm errm forced.. i mean issued to people which was 1L. No one who is selling these bonds now got them by actualy voluntarily buying them (well maybe a couple of people bought them by now but most of the holders actualy paid the "face value" of 1L not by choice). Calling them bond is a sin as well but if you want to okay go ahead I'm not gonna worry about it and if you want to say the the "present face value is .26L" that's fine too but remember they originally cost 1L each which is what they were told they would get back if they held them long enough to be paid back by the person who made them take em in the first place. They didn't go into a bank and buy a bond for $25 bucks here and hold it until they want to cash it in like one would for a bond or an rrsp 25 years from now when they retire or go buy a house or something and have it worth more money. We are talking about a so called bond that was worth less the second it was given out here to a bunch of people as a way to absolve himself of a debt.

Sure, just answer my questions and you wouldn't need to ask for attention.



Perpetual bonds are naturally not redeemable. There seems to be an buy-back option for GPB, however. Normal bonds can be redeemed. This is like trying to mix perpetual terms with non-perpetual bond terms. I see how it has confused you, and it is not me doing it.



On a perpetual bond, that is the face value. NP has fixed the dividend/interest rate based on L$1 instead of a perpetual bond's face value. Yes, that could confuse you and others more to think in non-perpetual terms.



With a perpetual bond, he doesn't even owe L$1 per bond. A perpetual bond normally pays back bond holders by interest/dividend payments until deflation.[/QUOTE]



A normal perpetual bond pays interest/dividends based on face value, being the current exchange rate on the market. He stated it is locked at L$1 per bond for what interest/dividend are based upon. It would normally be in your favor with the face value (exchange rate) goes above L$1 because that would mean a faster payback through interest/dividens. Being that it is fixed, it lacks incentive to go above L$1 on the market.

You still have not stated what I have not answered that is not a stupid question.

If Nick decides that he will redeem the bonds, he redeems them at 1L. We all know that he is not obligated to redeem them, which is the key difference between the perpetual bond and other bonds. It is his **choice** to redeem them. But we all know that human nature is that he will never redeem them. I see how this has confused you, and it is not me doing it.

I have it compartmentalized and understand the nuance, thank you very much. Ginko has pegged the interest rate at 3% of face value per quarter. He is paying 3% of the debt per quarter. The trading value does not really correspond to this number at all in any coherent way.

It is still a debt, but he has no obligation to pay it back. That he doesn't have to pay it back is just a nuance and does not erase the debt. But he wants you to think that.

There is no incentive here because there are no interest rates at play other than the ones Nick hopes to pay. There is no Fed setting interest rates. In RL, you would purchase this kind of bond solely to game the interest rate system levied by the world's central banks and other institutions. This is not RL, so the incentives are not the same.

here is the bottom line. When I buy a bond or put money into an RRSP or a GIC the money is there period. I go back say i decide I need to liquidate some 1 week after i buy them the original principle i put into the thing (if i am allowed to cash out when I want) is still there and even though I may only get 5 cents of interest I still get all the investment back. I can wait 10 years and ask them to reinvest my interest and then go back and cash it out or I can wait 10 years and ask them not to reinvest my interest and go back and cash it out and I will have my initial investment and a certain amount more. I can't go to this guy now and cash in my bond and have it worth the value I paid into it plus gather .26 L interest. Its not worth 1.26L its only worth .26L so the money is gone. In 8 years it will be worth what I paid for it maybe and according to nick. That's not a bond that's a loan and a 0% interest loan too. Not only can I not cash anything in before hand and at least break even I wont be any farther ahead then I was the day that he took my money from me and put it into this so called scheme.

I'm sorry but that's not a bond ...

Here is a good simple definiton of the types of bonds that can be issued please REALIZE that he has MADE NO GUARANTEE TO PAY THE BOND BACK FOR ITS PRINCIPLE INVESTMENT OF 1L which is the VALUE for which it was issued!

It doesn't even fall into the 0% bond category because he might maybe buy it back when he can. That's not a bond... Bonds have a set up way of maturing no matter what his according to him will mature in 8.5 years and at that time it will be worth 1L and the interest rate will be 0%. He states that the interest rate is 3% this in itself makes no sense.. its not a bond its a loan and a loan where he doesn't even guarantee to pay back the principle ever even at 0%. Basically he has put the thing into default today before the time it comes due which is in 8 years so your argument is with nick and how he has defined this thing. Its not a bond and its not even a perpetual bond...

bond
Definition

A debt instrument issued for a period of more than one year with the purpose of raising capital by borrowing. The Federal government, states, cities, corporations, and many other types of institutions sell bonds. Generally, a bond is a promise to repay the principal along with interest (coupons) on a specified date (maturity). Some bonds do not pay interest, but all bonds require a repayment of principal. When an investor buys a bond, he/she becomes a creditor of the issuer. However, the buyer does not gain any kind of ownership rights to the issuer, unlike in the case of equities. On the hand, a bond holder has a greater claim on an issuer's income than a shareholder in the case of financial distress (this is true for all creditors). Bonds are often divided into different categories based on tax status, credit quality, issuer type, maturity and secured/unsecured (and there are several other ways to classify bonds as well). U.S. Treasury bonds are generally considered the safest unsecured bonds, since the possibility of the Treasury defaulting on payments is almost zero. The yield from a bond is made up of three components: coupon interest, capital gains and interest on interest (if a bond pays no coupon interest, the only yield will be capital gains). A bond might be sold at above or below par (the amount paid out at maturity), but the market price will approach par value as the bond approaches maturity. A riskier bond has to provide a higher payout to compensate for that additional risk. Some bonds are tax-exempt, and these are typically issued by municipal, county or state governments, whose interest payments are not subject to federal income tax, and sometimes also state or local income tax.

I'll just use a nonce term: The GPBs were "denominated" at L$1. That's what the bank depositors paid for them when their cash assets were involuntarily converted. After the revaluation of the L$25 original-issue GPBs to be "worth" L$100 and subsequently split 1:100, those bondholders got them for an initial investment of L$0.25. So, yeah, at L$0.1 now, the original issue bondholders would lose 60% of their investment, and bank depositors would lose 90% (ignoring interest / dividends paid).

The original L$25 bonds were callable at (could be canceled with a "liquidation dividend" of) L$100. Now, post-split, GPBs are callable at L$1. In the current market, that's all kind of academic, but in principle, it's another way the bank depositors got (even) worse treatment than the original bondholders: because that call price represents an effective ceiling on the bond's market price, the original investors had an upside potential of 300% over their purchase price, whereas the bank depositors had zero upside price potential.

I think looking for RL analogies is pretty hopeless. For one thing, RL banks don't get to arbitrarily discount their deposits; as long as it remains solvent, a bank is obligated to pay the full value of the deposits in cash--no matter how much it may have to pay on debt (e.g., bonds) to generate that cash, unless and until that debt drives the bank to insolvency. When a bank is insolvent, then the bankruptcy court decides how much each class of creditor gets when the bank's assets are liquidated by the receiver, according to the statutory order of debt precedence. And a bank officer who takes deposits when the bank is known to be insolvent can expect to spend time in jail.

So the reason RL banks aren't called Ponzi schemes is that, by virtue of regulation, they aren't. (Ironically, following the 1999 currency crisis, Brazilian regulations require its banks to maintain cash reserves as a percentage of deposits that is among the highest in the world.)

I doubt he will cancel them (or redeem them in your sense), because that would mean he is ready to pay L$100 for each bond cancelled.

That was the cancel value stated before the split.

Huh the bonds are only worth 1L face value.

He can pay them back for 1L assuming people will sell them for that (theyd LOVE to)

The 100L price never enters into it

the 100L to 1L face value split was an ACCOUNTING change.


Basically he had X Dollars worth of bonds at 100L each and he chanced them to X dollars worth of bonds at 1L each

Its the same exact amount of money.

Basically if you had 1 100L bond you got instead 100 1L bonds. Simple as that.

Becuase they werent

Becuase the face value is 1L a bond

The .26 cents was merely what people were willing to trade them for at the time of the conversion.

Theres no reason to argue against you, becuase you are wrong.

Its like arguing agaisnt someone who is saying that Day is Night.

If you were right then there would have been an instant deletion of 74% of all outstanding debt, and WSE woudl never have stoped Nick from buying the Bonds for less than 1L.

That 25$ is just what the 100$L bonds were selling for on the real market. They still had a $100L Face value - Nick said this himself.

Nick flat out refused to let people convert their account balances to bonds at the current market rate.

They were "100L" bonds selling for $25L.

As you are saying -

When the remainder of account balances were converted there was a 1 to 100 split in the QUANTITY of bonds.

The total face value of the bonds never changed.

I think she isn't understanding that they paid 1L for something with a value of .25L or whatever and that when they mature they wont have made a dime..