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Almost $3 Trillion Of European Debt Has Negative Rates As German Yields Collapse Further
As German yields hit fresh record lows (and continue to collapse/flatten dramatically) amid Draghi's monetary excess, the size of ineligible debt surges across Europe. As SocGen notes, before today, there was already a stunning EUR 2.17 trillion of negative yielding debt in Europe (dominated by Germany and France) and today's moves mean that number is growing rapidly as Germany is now negative to a 7.5 year maturity.
Since Q€ the curve has collapsed...
leaving at least EUR 2.2 Trillion of negative-yielding debt across Europe...
This won't end well...
Charts: Bloomberg and SocGen
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The market is searching for a bottom. Does one exist?
How far can you walk into the forest?
A: Only half way, the other half you are coming out.
Tell you what. I'll take the ultimate logical step - the keynesian endgame.
If you buy 10-yr EscapeBonds right now, I will promise to pay you 0 upon maturity. That's right. I will pay you absolutely diddly-squat.
Time for another press conference.
4 stages of terminal, structural economic disease:
1) ZIRP
2) NIRP
3) HERP
4) DERP
"What is a Greek Bond?" Alex
By God!!!! I believe we have a solution to the Global economic collapse situation thingy!!!!
All we have to do is re-define all outstanding debt at -10% interest and everyone starts getting paid enough to make their loan payments. Think about it!!!!
WoW that is a huge relief.
And to think the German's have destroyed their citizens life savings once before.
The ECB is not headed by a German
The Germans negotiated this QE program to fit what they were comfortable with. Without German support there would be no QE.
Whether ECB or German, it is governmental institutions. You guys are arguing semantics.
Either way, the result is the same. They are government endorsed institutions that are out of control and enslaving people. And that is what government wants.
DB must be ecstatic.
Their default risk is dropping with the rate curve.
This is going to have huge capital concentration impact on the private sector. As investors are pushed out of gov bonds, they park their monies in safe Euro IGs, usually conglomerates, leaving the small/medium businesses out of the loop. A lot of acquisitions of smaller businesses by big players that have access to the bond mkt will take place. In summary, the rich will get richer, the employed unemployed and the middle and poor will simply get poorer. We only need mainstream economists to provide evidence that concentration brings higher consumption and economic growth to win the next Nobel laureate award in Economics, so that this is all masked as good policy.
already flattened and QE is just begun
Elizabeth Warren says she is not running for president
There is a God
The Cherokee Nation rescinds the hit contract.......for now.
Go Redskins!
You know what they say, "the devil you know..."
If you are truly religious, then you would understand that ultimate calamity is destined to occur. Thus is the book of revelations or other religious teachings of end times. In other words, who cares about Warren not running. That doesn't change the projectory of humanity. It wouldn't change even if we had a real constitutionalist libertarian elected.
1914,1939 , ?????????????????
So what do these effectively negative rates mean for pension funds and insurance companies in the long run?
Nothing to see here move along nobody is kicking the can here.
The only reason I would lend money at negative yields is because yields will go even more negative.
isnt that like saying the only reason i will buy a house is because housing prices will go even higher. hmm 08?
"This won't end well..."
presumes it will end.
Actually, technically grammatically speaking, it doesn't presume that.
Actually, technically grammatically speaking, it doesn't presume that.
Everything man made ends. We are not Gods.
Does anyone have some euro denominated Cash Call backed bonds for sale?
Big investors are willing to pay money to get their capital back. They are worried about bank haircuts, sovoreign defaults, confiscations. The money is trying to find a safe place to hide.
And some would think they would hide that money in PMs, but they aren't. That should tell you something. They didn't hide their money in PMs after 1929 either.
Look at Greece on that chart and that is the only country in the EU that is at a meltdown stage. Compare Greece to the big three of France, Germany, Italy. Greece is in better shape than those three, according to the charts.
A bizzare world indeed.
When dealing with a manipulated market one never knows which way to look at a chart. Upright, side ways, upside down....take a pick and make a bet. Anything is possible.