The defaults by Toys R Us and Puerto Rico were remarkably similar, even though corporate debt and sovereign debt are quite different. This article highlights three lessons that can be taken from both and one lesson that highlights a key difference between corporate and sovereign debt.
Would You Lend to Tajikistan?
The issue of bonds by Tajikistan this month follows on from recent low quality bond issues from Argentina, Greece and Iraq.
Cryptocurrencies and Blockchain are Just Reruns of 90’s Bubbles
The old saying that history doesn’t repeat but often rhymes sums up the fervour surrounding cryptocurrencies and blockchain.
BIS Nails the State of Global Corporate Debt
The Bank for International Settlements (BIS) quarterly report is always worth the read. Whilst it is academic in style and length, it consistently raises material that matters. Taken from the September report, the graphic below highlights the big issues for global corporate debt. The rest of this short article explains each component and its importance.
Emerging Market Debt: Dumb, Dumber and Dumbest
One of the classic signs that the credit cycle is nearing the end is that borrowers that shouldn’t be getting financed not only get funded, but get it at terms that seem crazy.
Eight Lessons from the European Bank Failures
June 2017 saw three notable failures of European banks under the new bank resolution regime. Investors seeking to avoid losses on future bank failures can takeaway eight key lessons from this month’s examples.
Australian Regulators Share the Blame for Housing Being Unaffordable
Australians have rightly applied the blowtorch to their politicians for housing being increasing unaffordable. The Federal Treasurer, Scott Morrison, has now turned the blowtorch onto financial regulators for their part in the problem. This article details what the regulators should have started doing years ago to fulfil their respective roles in creating a stable financial system.
Harvard Shows the Pitfalls of Internalising Funds Management
With so many fund managers overcharging and underperforming it’s no surprise that there’s a trend towards internalising funds management. However, Harvard’s experience shows that internalising is far easier said than done.
The Dallas Pension Fiasco Is Just the Beginning
The run of redemptions and lock-up of the Dallas Police and Fire Pension fund was entirely predictable. The same conditions exist elsewhere and point to a wave of state and local government pension and debt defaults in the coming decade.
Why Banks Fail: The Definitive Guide to Solvency, Liquidity and Ratios
Banks are complex, but understanding why banks fail and what can be done about it doesn’t have to be.
Will China Survive the Journey to Being a Developed Market?
Many countries have crashed and burned on the journey to being a developed market – will China be another?
Here’s What a Chinese Hard Landing Could Look Like
The following scenario shows how falls in the equity market in China could lead to a hard landing for its economy