Global Bond Issuance To Top A Staggering $8 Trillion In 2012

Tyler Durden's picture


As households are supposedly deleveraging and European nations face austerity, one might suspect that global debt levels were stabilizing or even dropping. Think again. It will likely come as no surprise when we point out that the G-7 nations alone face a massive $7.3 Trillion (with a T) of sovereign-only maturities (and a further $566 Billion in interest payments) in 2012 alone. This incomprehensible number is worsened only in historical comparison as it's current level is 125% higher than was 'expected' at the end of 2010 (and 238% higher than was expected for 2012 at the end of 2009). As Bloomberg points out, Japan tops the list with $3.05tn (equivalent) followed the US at $2.76tn for 2012 as the former peaks in March 2012 (with $678bn due in that month alone) and the latter peaks in this month with January 2012 seeing over $480bn due to mature (and be rolled). But it gets worse for supply - global corporations (dominated by Financials relative to non-Financials), as noted by S&P today, have used the low interest rate environment to modestly relever and face almost $1 Trillion (again with a T) of maturing debt that will need to be rolled in 2012 (with January and March also topping the list) and over $3.1Tn in the next four years. So in the next four years, amid a slowing demand picture thanks to European worries, global corporate debt combined with G-7 sovereign debt maturing is an incredible $18.48 Trillion that will need to be rolled, rehypothecated, and have capital allocated to it (or not).

Debt loads are piling up in shorter and shorter maturities for the G-7.

...and from the end of 2009, expectations for 2012's debt load (maturing and needing to be rolled) has increased dramatically...


Breaking down the $7.3 trillion equivalent debt maturities for the G-7 across the year, we see January and March as critical...

Obviously Sovereign issuance dominates Corporate issuance but European New Bond Issuance for 2011 was dwindling as we ended the year...

which worries S&P greatly:

European Corporate Issuance Volume Remains Thin, Reflecting Continued Investor Worry

New corporate bond issuance in Europe continues to be very thin, reflecting the economic uncertainty that has characterized the region for the past few months. New deals through the first half of December totaled $20 billion. Of this, 85% were investment grade and 15% were not rated; there were no speculative-grade deals. In addition, the number of European companies issuing debt outside of Europe has increased, demonstrating difficulty in securing capital from within the region.


In November, the total new bond issuance in Europe was $43 billion. About 10% of this total is attributable to the European Financial Stability Facility (EFSF), an entity created to safeguard financial stability in Europe by providing financial assistance to member states.

As they see huge amounts of financial and non-financial debt needed to be rolled over the next few years...


All-in-all, the debt loads are becoming awesome and face what Bloomberg describes as a bad combination:

The buyer base for peripheral Europe has obviously shrunk at the same time that the supply coming to the market is increasing, which is not a good combination,” said Michael Riddell, a London-based fund manager at M&G Investments.


but we agree with the following that it will be mid-year (March onwards) that the real problems of excess supply hit (and pre-judging when this gets (or how much of this is) priced into forwards is anyone's guess):

Investors should be most worried about the period after the ECB’s second three-year longer-term refinancing operation scheduled in February, according to Ignis’s Thomson.

“The amount of liquidity that has been supplied by central banks, with more to come from the ECB in February, suggests the first couple of months will be a sort of phony war as far as the supply is concerned,” Thomson said.

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Tue, 01/03/2012 - 16:45 | 2030177 BaBaBouy
BaBaBouy's picture

Print AWAY ... Bitchez ...

It's GOLD'en To Me.


And If we're Lucky, Ron Paul... 

Tue, 01/03/2012 - 16:49 | 2030260 tallen
tallen's picture

Don't forget silver! 

Peak silver reached in US, demand for Electronics, Jewelry and solar uses continues to rise. Ore grades globally continue to decline, the perfect storm for much higher silver prices.

Buying loads of phys through  Bullionvault(Anything below $30 is a steal) and some OTM SLV calls for some fun!

Tue, 01/03/2012 - 17:39 | 2030472 trav7777
trav7777's picture

we're like 5% of global production now?  big whoopie, US silver peak

Tue, 01/03/2012 - 17:45 | 2030497 tmosley
tmosley's picture

dat cognitive dissonance.

Batting 1.000 on being wrong on every issue.  Keep it up, dumbass.

Tue, 01/03/2012 - 19:40 | 2030814 kito
kito's picture

silver blew its load with expectations of inflation that did and will not come to pass. its done. deflation has already done its damage to silver.

Tue, 01/03/2012 - 19:54 | 2030849 WonderDawg
WonderDawg's picture

Deflation is not finished with the damage just yet. More to come, bigger and badder.

Tue, 01/03/2012 - 20:56 | 2031000 baby_BLYTHE
baby_BLYTHE's picture

how come nothing I buy is getting cheaper? I pray for DEFLATION! They never have nor will ever allow deflation. The phony growth, leverage, exhausted energy inputs and demographic time bomb must be prolonged as long as possible! Must protect banker bonuses, the world-wide military empire and the domestic police state. No reset into a more free and favorable Republic allowed!

Tue, 01/03/2012 - 21:05 | 2031047 Greenhead
Greenhead's picture

Seems that if supply is up and demand isn't enough and we are in a manufactured low interest rate environment, the only buyers are the buyers of last resort.  Central banks will have to monetize if they really want to keep interest rates low.  Sounds like a recipe for printing.


Tue, 01/03/2012 - 21:10 | 2031071 unununium
unununium's picture

b_B +8T

kito has learned nothing

Tue, 01/03/2012 - 21:44 | 2031194 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

The reset is coming Blythe. It will be fast and furious!

Tue, 01/03/2012 - 22:00 | 2031225 Eatabanker
Eatabanker's picture


"Mother nature provides birds for the worms, but she doesn't drop them in their nest". 

As for your strategy of praying for deflation, I fear your prayers will be answered in spades.

Experience has taught me whining is not a very useful strategy. Perhaps you should consider investing your fleeting time

and diminishing energy watching and learning the rules from more successful individuals whose values you share. 




Tue, 01/03/2012 - 17:18 | 2030396 Meremortal
Meremortal's picture

America is not going to elect a man to the Presidency who would turn 80 during his first term, IF he lives that long.

Tue, 01/03/2012 - 18:10 | 2030603 Sudden Debt
Sudden Debt's picture

do you know why they never elect a pope younger than 65?

Tue, 01/03/2012 - 19:24 | 2030769 Eally Ucked
Eally Ucked's picture

John Paul II was 58 when elected

Tue, 01/03/2012 - 18:08 | 2030592 Sudden Debt
Sudden Debt's picture

Oké, oké... let me just take my checkbook and write you a.....


they can cash them in with every US citizen.


Tue, 01/03/2012 - 16:41 | 2030185 Cognitive Dissonance
Cognitive Dissonance's picture

A $Trillion here, a $Trillon there. Before you know it you're talking "real" money.


Tue, 01/03/2012 - 16:52 | 2030281 smlbizman
smlbizman's picture

heres the check for 2012....just dont cash it till monday...

Tue, 01/03/2012 - 17:17 | 2030390 NotApplicable
NotApplicable's picture

*Monday Morning, phone rings...*

Hey buddy, can I borrow some more money to cover the check I gave you. No, dude, it's totally cool, solvent as a motherfucker. It's just with this whole lack of liquidity in the market, things are gettin' tight. Why I even had to sign over my kids as collateral at the Fed window last week!

Tue, 01/03/2012 - 17:43 | 2030492 trav7777
trav7777's picture

start diggin in the couch cushions

Tue, 01/03/2012 - 17:15 | 2030379 chubbar
chubbar's picture

OT but things are heating up over in the "birther" camp! Looks like a judge finally found the balls to rule that yes, someone in the U.S. does actually have a right to verify the qualifications of a person running for president as outlined in the constitution.

It appears that Obama is going to be deposed on why he has a Connecticut SS # as well as why he submitted a forged long form Birth Certificate. This ought to get interesting, assuming the judge isn't hit by a bus or drowns in a hot tub.


Tue, 01/03/2012 - 17:23 | 2030416 NotApplicable
NotApplicable's picture

Likely this is more "Poor Obama" theater designed to make him look human. While the SSN may be suspect, there's plenty of reasons why it could be legit (plausible deniability, ftw!) due to how it was implemented. If nothing else, it should make for cheap entertainment.

Tue, 01/03/2012 - 16:36 | 2030187 ACP
ACP's picture

I can't believe I can still buy food at the supermarket with worthless linen bitchez!

Tue, 01/03/2012 - 16:40 | 2030218 Cognitive Dissonance
Cognitive Dissonance's picture

I can't believe I can still buy Precious Metals with worthless linen bitchez!

Fixed it for ya. :>)

Tue, 01/03/2012 - 16:41 | 2030225 ACP
ACP's picture

Excellent Smithers...yessss......eeeeeeexcellent!

Tue, 01/03/2012 - 16:56 | 2030300 DoChenRollingBearing
DoChenRollingBearing's picture

Buy both!  Diversification!

Tue, 01/03/2012 - 16:49 | 2030267 LawsofPhysics
LawsofPhysics's picture

Sure you can, just be sure to bring more and more of that paper.  It will continue to work until the holder of the food won't sell it, or there simply isn't any available.   Amazing how that ounce of silver that filled a gas tank in the 1950's, still fills a tank (and look up 6% in one day), how's that paper of yours again?

Possession has always been 9/10 of the law, soon it will be all that matters.

Tue, 01/03/2012 - 17:01 | 2030318 HungrySeagull
HungrySeagull's picture

By damn!


So Silver does fill a tank 60 years later.



The writer has one thing wrong. We are not deleverging, we are actually flying away from the rotten feeder and learning to catch fish ourselves again.,...


If only those damn fish stop glowing at night.. We need our sleep.


Today I quit paying 5.00 for a bag of Pretzels and bought Crackers, salted for a buck 24. Where does that leave the maker of the Prezels?


And that Cotton that supports the dollar bills at the Mint needs to keep growing. Despite the flooding, we expect to Choke the world in dollars and corn.

Ponder that!

Tue, 01/03/2012 - 17:40 | 2030478 LawsofPhysics
LawsofPhysics's picture

I grow cotton, been two good years.  If only you needed cotton to simply "add zeros".  Too bad you don't, so you mint comment is bullshit. Remember, the bernanke said they were not printing.

No worries, I like fishing and have the land and resources to do so, all that will matter in the future.

Tue, 01/03/2012 - 17:47 | 2030504 tmosley
tmosley's picture

Make your own pretzels.  Delicious AND much cheaper.

Though perhaps not for long.  My source of flour (25 pound bags) just went up by 14%.

Tue, 01/03/2012 - 16:57 | 2030302 economics1996
economics1996's picture

I went from shoping at Publix to Albertsons to Aldi.  Anyone notice the nice 70% markup on eggs?  99 cents to $1.69 a dozen at aldi?

Tue, 01/03/2012 - 17:02 | 2030326 HungrySeagull
HungrySeagull's picture

Still a damn sight cheaper than the Mcdonald's eggs I gotta tell ya.

*Truck stop meals excluded. Those are high calorie 1000 miles to go food when you dont know when or where you will eat again.

Tue, 01/03/2012 - 16:37 | 2030193 gabeh73
gabeh73's picture

Goto Drudge Report Caucus and vote to end the racist wars. Vote Ron Paul

Tue, 01/03/2012 - 16:39 | 2030214 GeneMarchbanks
GeneMarchbanks's picture

What about the non-racist ones?

Tue, 01/03/2012 - 16:42 | 2030235 hugovanderbubble
hugovanderbubble's picture

US has the enemy inside...its called the Fed.

Tue, 01/03/2012 - 16:45 | 2030252 GeneMarchbanks
GeneMarchbanks's picture

Even a Spaniard knows that ;)

Tue, 01/03/2012 - 16:43 | 2030241 Schmuck Raker
Schmuck Raker's picture


Tue, 01/03/2012 - 17:16 | 2030388 Meremortal
Meremortal's picture

What about the anti-semitic ones?

Tue, 01/03/2012 - 17:41 | 2030484 trav7777
trav7777's picture

I'm going to vote to have people who keep claiming everything they don't like is RAYCISS put in a cage.

the US is DIVERSE. We have massive diversity all up and down government and in society.  And the MSM says RP is a rayciss too.

Tue, 01/03/2012 - 16:37 | 2030194 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Nothing Keynesiansim can't handle!

Tue, 01/03/2012 - 16:40 | 2030215 i love cholas
i love cholas's picture

I wonder if I will surive to see a Zillon

Tue, 01/03/2012 - 16:59 | 2030317 Caviar Emptor
Caviar Emptor's picture


Tue, 01/03/2012 - 17:04 | 2030330 HungrySeagull
HungrySeagull's picture

I guess if my ass keeps growing wider, I might have a pocket big enough to hold one of those monster bills someday.


Somebody pass the JELLY! (A cookie if you remember this one)

Tue, 01/03/2012 - 16:40 | 2030217 hugovanderbubble
hugovanderbubble's picture

long Lexmark


Tue, 01/03/2012 - 17:18 | 2030393 HungrySeagull
HungrySeagull's picture

No no no.

Lexmark is crap.


Come here inside my draft room, let me show you the new remade Dot Matrix Printer that is featuring a 30mm Gatling Gun to keep up with today's high speed dot matrix printing needs!

No laser or ink needed.

Tue, 01/03/2012 - 16:41 | 2030220 AC_Doctor
AC_Doctor's picture

Pray for buyers, Kleptocrats and bank slime or die trying...

Tue, 01/03/2012 - 16:41 | 2030223 youngman
youngman's picture

8 trillion for the sovereigns....but there is Bank debt that is coming due...and other who will buy it....especially if it is still rated AAA....or rated me this is the question....Greece has 14 billion coming due in March.....who who who let the dogs out....and who will buy that???? No one with skin in the game...but if you give me the money for free...I will do it for you for a FEE.......a fast payout fee....

Tue, 01/03/2012 - 16:59 | 2030315 economics1996
economics1996's picture

Ben will print.  He thinks he is smarter than the markets.  His plan is to print just enough to offset the defaults.  History shows no one is smarter than the markets.

Tue, 01/03/2012 - 17:39 | 2030471 tekhneek
tekhneek's picture













Tue, 01/03/2012 - 17:42 | 2030486 DoChenRollingBearing
DoChenRollingBearing's picture

+.  1.

Wed, 01/04/2012 - 09:46 | 2032396 Hephasteus
Hephasteus's picture

Opening his trap about it was making the gold market manipulation too difficult.

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