The True French Debt To GDP: 146%

Tyler Durden's picture


From Mark Grant, author of Out of the Box, and onto Wall Street

Watch what They do; NOT what They Say

Over the weekend there was a Bloomberg article quoting the Bundesbank that was telling. The German Central Bank will no longer accept the sovereign debt of Ireland, Greece or Portugal as collateral. Now my operating assumption with central banks is that they know more than we do as they have more access to information and they get it first. If a central bank rejects collateral it must be for one primary reason and that is because they think the collateral has too much risk and that they could suffer from the consequences of holding it. Further, it was interesting to note that this was an announcement; a public statement. The Bundesbank could have handled it all quietly, said nothing and just refused to accept the collateral but no; a public declaration.  What they have done, in my opinion, and at the risk of surely offending Ireland, Greece and Portugal and also the ECB who will accept these sovereigns as collateral, is clearly signal that there are more problems to come with these three countries. The Bundesbank, in my view, has just stood up and waved a giant red flag in the breeze and I see it and I am paying attention. Something is amiss, some thing or some things are coming and we should all be standing back, way back, because whatever is about to show up on the landscape will not be pleasant; of that much you can be assured. This is not, to quote the Bard, “Much Ado About Nothing” but Much Ado About Some Thing and I give those in Berlin thanks for the warning.

"I have deceived even your very eyes: what your wisdoms could not discover, these shallow fools have brought to light…”

-William Shakespeare, Much Ado about Nothing

Shedding Light

In my continuing attempt to debunk what the European Union presents as facts; I turn my attention to France. I have already given you the correct debt to GDP ratios for Spain, Italy, Portugal and Germany which follows the exact principles of what any corporation in America or Europe would be mandated to report or suffer the slings and arrows of being held accountable for Fraud. I include contingent liabilities, derivatives, promises to pay, various guarantees and all of the normal accounting practices to be considered on any balance sheet except the sovereign nations of Europe. In the end, of course, it is your decision but at least we can begin any consideration based upon the facts and not based upon a fictitious account. Again, I divide up the liabilities into two categories, their national obligations and their European obligations; the European Union, the European Central Bank and finally for the other European institutions for which they bear some burden. Then I add it all up, divide by their GDP and we arrive at a factual accounting. Nothing complicated here except sleuthing about to get the data which is no easy task as it is hidden in various nooks and crannies.

How many Europeans does it take to screw in a light bulb?

One to hold the bulb and the rest to provide enough mis-information to make the economic world spin.


The Official French GDP                                      $2.774 trillion


Admitted Sovereign Debt                                   $2.261 trillion

Loans to the Nation                                           $214.9 billion

Admitted Bank Guaranteed Debt                        $479 billion

Dexia Guarantee                                                $55.48 billion

Total National Debt                                            $3.010 trillion


France’s Liabilities at the ECB                            $569 billion

France’s cost for the EU Budget                        $23.2 billion

France’s Liabilities for the Stabilization Funds    $110 billion

France’s Liabilities for the Macro Fin Ass. Fund   $203 billion

France’s Guarantee of the EIB Debt                   $137.6 billion

France’s Total European Debt                            $1.043 trillion  

France’s National and European Debt             $4.053 trillion

France’s Official Debt to GDP Ratio                       86.1%

France’s ACTUAL Debt to GDP Ratio                  146%

“It is dangerous to be right in matters on which the established authorities are wrong.”


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Mon, 04/02/2012 - 08:44 | 2309223 battle axe
battle axe's picture

Bundesbank: "It is every man for himself Bitchez"

Mon, 04/02/2012 - 09:19 | 2309302 economics9698
economics9698's picture

Somebody needs to tell the CIA World Fact Book of this.


Mon, 04/02/2012 - 14:24 | 2310203 Idiocracy
Idiocracy's picture

The CIA aren't so razor sharp with facts.  Facts like the debt to GDP of France or if Saddam had WMD's.  But hey, you expect perfection for only $5 billion or so per year?

Mon, 04/02/2012 - 15:42 | 2310424 AlvarezEarnestine7
AlvarezEarnestine7's picture

my best friend's sister makes $63/hr on the computer. She has been out of work for eight months but last month her pay was $18250 just working on the computer for a few hours. Read more on this site...

Mon, 04/02/2012 - 08:48 | 2309228 Zola
Zola's picture

You should keep in mind that 50pct+ of French GDP is govt spending as well. So a more interesting ratio would be Government Debt/Private GDP... Rock meet hard place...

Mon, 04/02/2012 - 08:57 | 2309248 mayhem_korner
mayhem_korner's picture



...and also report GDP net of gov't expenditures. 

Mon, 04/02/2012 - 12:02 | 2309785 Mountainview
Mountainview's picture

Fortunately they sold most of their debt to their countrymen...

Mon, 04/02/2012 - 08:48 | 2309229 GeneMarchbanks
GeneMarchbanks's picture

Mark Grant = pretend expert.

Mon, 04/02/2012 - 08:54 | 2309240 mayhem_korner
mayhem_korner's picture



GMB: maybe just present your perspective and supporting facts & let us decide for ourselves...?

Mon, 04/02/2012 - 09:06 | 2309269 GeneMarchbanks
GeneMarchbanks's picture

No need my friend, it is all too clear. Grant is about as 'Out of the Box' as Tchir with an even more anti-Euro bent.

Mon, 04/02/2012 - 09:13 | 2309289 mayhem_korner
mayhem_korner's picture



Ok - thanks.  I know to take you at your word from now on.

Mon, 04/02/2012 - 09:33 | 2309336 GeneMarchbanks
GeneMarchbanks's picture
Get your facts first, and then you can distort them as much as you please.  --Twain
Seems silly to start the game of providing other facts to oppose his facts. Should be in plain sight at this stage, no?
Mon, 04/02/2012 - 09:45 | 2309368 mayhem_korner
mayhem_korner's picture



Regrets, but the Euro situation is not my expertise at all.  What I understand comes from reading, reviewing and comparing perspectives from many different sources.  So forgive me if any one source doesn't stick out as being "wrong".

Mon, 04/02/2012 - 10:48 | 2309570 GeneMarchbanks
GeneMarchbanks's picture

Never said it was 'wrong' only skewed and a patchwork with severe narrative bias.

Ask yourself a simple question before you search for 'facts' among these so called 'experts': how is it that in the West where many nations have debt/GDP over 100% some are  worse off than others?

Mon, 04/02/2012 - 08:50 | 2309234 i-dog
i-dog's picture

Sacre bleu!

Mon, 04/02/2012 - 10:21 | 2309487 Schmuck Raker
Schmuck Raker's picture

...'cuz he needed the money.

Mon, 04/02/2012 - 08:52 | 2309236 mayhem_korner
mayhem_korner's picture



If the truth was devoid of consequences, these central planners wouldn't try to hide it.  The ugliest truth of all, me thinks, is their motivation for doing just that.

Mon, 04/02/2012 - 08:54 | 2309241 espirit
espirit's picture

Just goes to show that other sovereigns, including the U.S. can kick that can much further than anyone can imagine.

This can only end in a great reset to "zero".

Mon, 04/02/2012 - 09:04 | 2309262 mayhem_korner
mayhem_korner's picture

Just goes to show that other sovereigns, including the U.S. can kick that can much further than anyone can imagine.


Just a thought: in hockey, when your team is defending a power play, those two minutes seem eternal; but when your team has the man-advantage, time seems to speed up.  Seems we "in-the-know"ers are on the shorthanded side and that the can-kicking situation won't end.  I wonder if the TPTB feel like they're power play is winding down faster than they'd like?

Mon, 04/02/2012 - 08:59 | 2309252 Fantasy Planet
Fantasy Planet's picture

That's 7+ milliion croissants per household. 

Mon, 04/02/2012 - 09:00 | 2309255 Bahamas
Bahamas's picture

they can use some good Bordeaux for collateral

Mon, 04/02/2012 - 09:56 | 2309402 Overflow-admin
Overflow-admin's picture

There isn't good Bordeaux anymore for collateral, only Beaujolais Nouveau (EEK! Tastes risky!)

Mon, 04/02/2012 - 09:04 | 2309263 SheepDog-One
SheepDog-One's picture

The thing theyre desperate for is disarming of america, they cant figure out how to do it. They keep stalking around the great beast, coming up with half-fake things like Trayvon Martin but each attempt just falls apart more. All they need to bring the whole thing down is a disarmed american public and they thought they'd have that done by now. Well, all you got to do is go for it, we'll see how that works.

Mon, 04/02/2012 - 09:05 | 2309266 francis_sawyer
francis_sawyer's picture

We surrender!

Mon, 04/02/2012 - 09:10 | 2309284 barwar
barwar's picture

Mark - excellent job bringing this to the light of day.  These subtle accounting tricks make all the difference in the world and must be highlighted for what they are - a scam.


Kudos and keep up the great work.  -Lucas Jackson, war hero

Mon, 04/02/2012 - 09:31 | 2309334 The Beam
The Beam's picture

I ask this simple, yet important, question all the time.

What happens if an individual's debt situation was like this? What would happen is the individual/company would go bankrupt. This is true for countries as well. They either go bankrupt or suffer just as bad of a fate (if not worse) in hyper inflation.

Problem in getting people to understand bankruptcy is that there is a negative stigma in it. People would rather lose everything than go bankrupt. Going bankrupt simply means you made a bad economic decision (or a bunch), you take the hit (along with others who were counter party on the deal), and you move along.

After you get in bankruptcy, you are supposed to be smarter when you come out of it. Those that suffered loses due to lending to somebody who went bankrput, they are supposed to learn from it and lend to safer people the next time.

This how it is SUPPOSED TO WORK. But like many common sense things, it gets twisted and turned until it is no longer recognizable.

Mon, 04/02/2012 - 09:45 | 2309369 Silveramada
Silveramada's picture

Touche' les amis

Mon, 04/02/2012 - 10:26 | 2309507 chinaboy
chinaboy's picture

Truthfulness of the official French sovereign debt is similar to that of Greece. Good job, Mark.

Mon, 04/02/2012 - 11:28 | 2309683 ObungaBoy
ObungaBoy's picture

If you calculate the debt in that way, then U.S. debt would be severer hundred of trillions

Only the guaranteed by the Government  debt of BoA is 76 trillions …..

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