For the first time this century, China’s role has shifted from a major provider of capital, primarily to developing economies, to a lender that claims to service debt. This shift will have far-reaching implications for global credit conditions. It could fuel instability in many parts of the world and lead countries into strategic geopolitical realignments. …
Tag: debt
Rescheduling the maturities of US debt securities and Linking the dollar to gold
After the geopolitical earthquakes caused by the US’s reorientation of its stance on Ukraine and its rapprochement with Russia, a new earthquake is being planned, this time in the economy. In a move that could reshape the global financial landscape with unpredictable consequences, President Donald Trump is reportedly planning a major restructuring of international debt …
The Global Debt Crisis is just around the corner
The bond market and dollar index have begun to sensitize to the potential implications of another Trump victory. The ten-year yield has increased by 55 bp. after the Federal Reserve cut interest rates in mid-September. Americans who have been waiting for rate cuts are once again battling with their mortgage rates starting with the digit …
USA: At 1 trillion interest on debt for the first time in history, explosive budget deficit
2024 was the year in which the huge US budget deficit was supposed to have gradually leveled off after two years of crisis. The US was supposed to end the spending spree. All this, on a theoretical level. As of August, the US deficit has exceeded that of 2023. What does the evidence say?
Slowly and steadily cracks are appearing in the Financial System
The FED raised interest rates above 5%, yet the US economy is not broken. The bond yield curve has been inverted since 2022 and has remained inverted ever since. The lags looked short, with the US economy only briefly causing concern in 2023 when there was a consensus among market participants that a recession would …
Wall Street: The debt bubble of 1.7 trillion dollars in the private debt shadow market
Private credit has grown exponentially in recent years as banks have reduced their balance sheets due to tighter regulations. The private debt bubble harkens back to the days of crazy investment risk-taking before the 2008 financial crisis. Right now we have a boom in the $1.7 trillion private debt market, where private equity funds lend …
Debt Colonies End: Non-Western Rating Agencies for the Global South
As the BRICS group seeks to develop alternatives to the Western financial system, the creation of credit rating agencies independent of the West could be on the agenda at their annual summit in October. In addition to developing an alternative payment system for trade transactions in local currencies, the Global South’s credit rating agencies could …
Its perpetual public debt as Greece’s dependency factor
The public debt (Central Government Debt) amounted to €406.5 billion at the end of 2023 and is increased compared to the previous year by €6.2 billion, according to the latest Bulletin of the Public Debt Management Organization (in Greek-ΟΔΔΗΧ) . For this debt, the Greek State paid €6.5 billion in interest in 2023. The Greek …
Debt repayment in 100 countries requires a reduction in spending on social infrastructure
The world is going to experience a debt crisis that will last for the next 10 years and it is not going to end well, as global debt has reached a record 307.4 trillion. dollars last September. Both high-income countries and emerging markets have seen a significant increase in their debt, which has increased by …
Light Painkiller the interest rate cut, loop the over-indebtedness
While the Federal Reserve and European Central Bank’s message on rate cuts appears clear as they reiterate their commitment to reducing inflation, the market expects between five and six rate cuts, between 125 and 150 basis points , the next twelve months. This shows us the tendency of investors to overlook bubbles. We live in …