What Do These Numbers Have In Common: 1,039,000,000,000,000 And 2,170,000,000,000

Tyler Durden's picture

With Japanese and Italy 10Y bond yields hitting all-time record lows (0.505% and 2.626% respectively), one could be forgiven for thinking that all-is-well as term or devaluation premia are oddly missing. However, as the following two charts show, Japan and Italy just broke another record - sovereign debt loads (1.038 quadrillion JPY and 2.17 trillion EUR respectively).


Japan  - having topped 1 Quadrillion early in the year - is marching ahead...


and Italy is not looking back - just look at that 'austerity'...


*  *  *

Keynes would be proud...


Charts: Bloomberg

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ebworthen's picture

Because robbing the public treasury and not paying savers always works out so well.

Cognitive Dissonance's picture

"(QE) It's good to the last drop." Old Maxwell House coffee commercial adopted by central bankers.

knukles's picture

So any left over 70's investment gurus.... What ever happened to "crowding out"

Cognitive Dissonance's picture

It's been replaced by 'crowd funding' central banking style. They fund their exclusive crowd and send the bill to bond holders and tax payers.

knukles's picture

Oh yea.... they's be printin' da money ta buy da stuffs.  
Guess that's aggregate demand drivin' up the prices.
Whoda thunk!

Leeme see a moment... Remember Paul Volcker's Saturday Night Massacre when he moved to decrease the quantity of money in circulation?
That was kid's stuff compared to....
Oh, never mind....

That's funny "crowded funding"

SafelyGraze's picture

the more units of currency you print, the more value each one has

this is because each unit serves as a sort of an advertising medium, increasing the total popularity and name recognition for the brand

Dialing for Dollars and Edward Bernaise

aVileRat's picture

No, it's just called a bond bubble waiting for the Minsky moment. Because people tend to think 10 or 30+ year gov. bonds are a safe place. Safe from what, and for who, is the kicker. And in the end, will corporates outlast their government reset ? 1932 Germany and Brazil point to: yes. But don't tell your local pension fund that, who would need to mark to market their stupidly illiquid bond positions left over from 2008. Just like those Japanese pension funds still hiding from the 1988 rate "reset".


BobPaulson's picture

Things that can't go on forever, don't.

ThirdWorldDude's picture

The Quid Squid!


O/T: http://youtu.be/ha2B-HQGQdo (The Kilimanjaro Darkjazz Ensemble - 'Lead Squid')

NOTaREALmerican's picture

It's only debt when you can't borrow more to pay the interest.    Otherwise it's equity. 

Darksky's picture

Sigh, i only have one up arrow to give.

Instead of these double pop up ads for generating revenue, can i buy additional up arrows for $0.05? Come on Tylers, sounds like a good idea to me.

craus's picture

These numbers aren't anything compared to what the Federal reserve has been using since 2008 to artifically 'save' the stock market.

I mean what they honestly have been injecting into the stock market.

Yen Cross's picture

 Quadrillion... Good grief. 

  What's really disturbing is the fact that Japan will keep printing until the Death Star implodes, leaving screwed over bag holders in every corner on the planet.

buzzsaw99's picture

quintillion next, along with the F series bank notes. #WINNING!

steelhead23's picture

Before you get too smug thinking the JPY is toilet paper, the exchange rate isn't a million yen to one dollar - its about 102JPY/USD.  Carry on.

AdvancingTime's picture

Japan is the weakest link! Japan is facing a wall of debt that can only be addressed by printing more money and debasing their currency. This means paying off their debt with worthless yen where possible and in many cases defaulting on promises made. Japan's public debt, which stands at around 230% of its GDP and is the highest in the industrialized world.

 The moment the Japaneses stock market fails to rise enough to offset inflation this will turn into a tsunami of  money fleeing Japan and constitute the end of the line for those left holding both JGBs and the yen. This has been a long time coming and I contend the cross-border flow of money leaving Japan is why some stock markets have remained so resilient . When Japan crumbles it will be felt across the world. More on this subject in the article below.



venturen's picture

where is the US chart? We are even worse giving are wealth to the most crooked!

Itchy and Scratchy's picture

Do those numbers include legacy liabilities ...or does it matter?

knukles's picture

A quadrillion here and a quadrillion there any pretty soon you're talking unfathomable numbers.


The more you borrow, the lower your interest rate goes. Got it, tks. 

Irishcyclist's picture

1995 - 2004. 

In a period of a mere 19 years, two "first world" economies appear to be completely banjaxed.

Flounder's picture

Full faith and credit of Super Mario and Shinzo.

MountainsRoam's picture

We got to be getting close to the big one..

Salah's picture

Ambrose says Italy will bring back the Lira and bolt the E.U.....or collapse


Ghordius's picture

Ambrose Evans-Pritchard is writing for years "whatever it's good" against the EUR. His recipy is default by devaluation. In this, he is a Keynesian masqueraded as sometimes-libertarian. Note what he writes at the end:

"Italy would not face an immediate funding crisis since it has a primary budget surplus. Its net international investment position is -32pc of GDP, compared with -92pc for Spain and -100pc for Portugal.

The country does not suffer from excess debt in any fundamental sense. Mortgage debt is very low. Aggregate debt is around 270pc of GDP, much lower than France, Britain, Spain, Japan, the US, Sweden or the Netherlands. The root problem is an exchange rate misalignment that creates an unnecessary public debt crisis through the perverse mechanisms of EMU."

Sorry, but I've lost long ago any respect for AEP. For him, all things look like nails, and the EUR is his favourite target. He'd go apeshit if gold was restored as money

Manipuflation's picture

But my wages do not increase and the price of everything goes up so it must a recovery.

ShakaZulu's picture

I'm looking for 2 things.  A pretty translator and some cheap Japanese real estate.

AdvancingTime's picture

At some point the return on loaning money is simply not worth the risk!  It might soon become apparent the economic efficiency of credit is beginning to collapse and the additional money poured into the system coupled with lower rates can no longer drive the economy forward.  When this happens we are at the end game.

 Why do you want to loan money if most likely you will never be repaid or repaid with something that is totally worthless? When this happens the only safe place to store wealth will be in "tangible assets" and the only lenders will be those who print the money that nobody wants.

The collapse of credit can pose major problems such as what we saw when many sellers were forced to demand payment up front before shipping goods in 2008. More on this subject below.