So, debt owed on Euro transactions is Higher than Debt owed on the Dollar. Is that good, or Bad? That sounds bad to me. If the Euro drops in value, won't that debt be harder to recover?
I remember that Iran is now selling oil in Euros now, and others are leaning that way.
It's not great, but its not awful. Temporary setback.
That's the key sentence.
This is because European nations are running horrendous deficits. And it's only going to get worse because they see incapable of cutting back their extremely generous welfare systems, especially pensions and health care.
"Outstanding debt issued in the euro was worth the equivalent of $4,836bn at the end of 2006 compared with $3,892bn for the dollar, according to International Capital Market Association data."
Just so everyone has the facts (not that this is something to brag about)
I think they are taking debt issuance for the year, not aggregate outstanding value. European debt tends to be shorter tenor so of course you are going to see more issuance as more guys are coming to the watering hole each year to replace maturing debt. The US Bond market is north of 20 trillion dollars. In addition, the figure for the US seems small in the article...
A few facts from the BMA -
1,800bn Municipal Bonds
3,100bn Treasurys
2,300bn Agency Bonds
4,000bn Corporate Bonds
2,500bn Money Markets
4,000bn Mortgage (Agency)
584bn Private Label Mortgage
1,500bn Asset Backed Securities
19,784bn Total
http://www.investinginbonds.com/MarketAtAGlance.asp?catid=31&id=78