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The Venezuelan cash crunch: exporting passports as a palliative?

Venezuela’s cash flow crisis has been well covered. The recent default on its sovereign debt and likely default on the debt issued by its state-owned company, Petroleos de Venezuela SA (PDVSA), combined with collapsing imports attest to its ongoing cash crunch and humanitarian crisis. ¹

A change of economic policy however, would alleviate the crisis and improve the patient’s health. This could …

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China’s rising domestic bond defaults could spell offshore bond market rout

Chaori Solar and Baoding Tianwei will forever remain in the history of China’s bond market. In March 2014 the former became the first defaulter in the country’s onshore bond market whilst the latter turned out to be the first state-owned enterprise (SOE) default in China in April 2015. Since then, 24 other bond defaults occurred in the country, the majority of which in the manufacturing, metals…

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Greece – the next country getting roughed up by the Bond Vigilantes

The original ‘Bond Vigilantes’ were the bond investors who reacted to authorities’ loose monetary or fiscal policies by forcing sovereign bond yields higher, thus punishing central banks or governments by increasing the cost of issuing further debt.  Right now, the Bond Vigilantes are hunting around the world like a pack of wolves. Japan was the prey a few weeks ago (see recent blog comment her…

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