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According to the IMF forecast, in 2014, the total debt of developed economies was 50.95 trillion US dollars, a year-on-year increase of 2.32 trillion US dollars; the debt ratio of developed economies was 108.32%, up 0.66 percentage points year-on-year, and debt risk still plagued advanced economies.
First, the US debt problem has temporarily eased. The US Treasury report shows that the US fiscal year fiscal deficit was $680 billion, a decrease of $410 billion from the previous fiscal year of $1.09 trillion. This is the first time in five years that the US government has reduced its fiscal deficit to $1 trillion. The following is mainly due to the US automatic deficit reduction plan and the increase in tax revenue, which has risen to the highest level. Although the deficit has decreased, it is still at a high level, and the fiscal deficit to GDP ratio fell to 4.1%, lower than the 6.8% in FY2012 and the peak of 10.1% in 2009, still higher than 1.2% in the seven years before the financial crisis. 3.5% level. Considering that the current US federal government debt has exceeded 17 trillion US dollars, the US national debt burden rate is as high as 105%. Exiting the QE policy, reducing the national debt or mortgage bonds will lead to the global financial market liquidity contraction.
Second, European debt still harbors hidden risks. Judging from the current economic performance of the EU, the economic imbalance among member states has hidden hidden dangers in the process of integration of the fiscal union in the later period, and the shadow of the European debt crisis is still lingering. The public debt of Spain and Italy is too large to be fully covered by the euro zone aid mechanism. Spain has made great progress, but the country still needs to work harder because of the lower starting point; Italy’s direct pressure on fiscal and external imbalances is small, but insufficient progress in structural reforms to improve productivity remains a long-term problem. Therefore, the next fiscal union and banking alliance still face no small challenge.
Third, the pressure on Japanese debt financing has risen. At present, the reform of the Japanese government has not played a fundamental role in solving structural imbalances. Structural imbalances are manifested by the fact that on the one hand, the private sector has excess savings, and on the other hand, it has to absorb these excess savings with huge fiscal deficits, which has led to a sharp increase in the size of public sector debt. The Japanese government has basically decided that the total budget for 2014 will be 95.88 trillion yen, the highest level in history. According to estimates by the International Monetary Fund, Japan’s debt ratio is expected to reach 245% in 2013. In 2014, Japan’s government debt service accounted for nearly a quarter of the current account’s fiscal expenditure. At the same time, as the Fed’s exit policy will trigger global long-term bond yields and Japan’s inflation rate rises, the national demand for government bonds is bound to decline. Push up Japan's debt burden and increase the risk of sovereign debt financing.
In addition, the debt risk of emerging economies has also begun to increase. Unlike developed countries, emerging economies have a clear “plus leverage†trend after the financial crisis. Since 2008, the lack of global aggregate demand has led to a decline in import demand in developing countries, resulting in a significant reduction in external surpluses in export-oriented emerging economies, implying a tightening of external access liquidity in emerging economies. In this context, emerging economies either absorb foreign financing or compensate for external liquidity through internal financing, which leads to the widespread leverage of emerging market economies in terms of balance of payments or domestic economic sectors. rise. When the Fed started to withdraw from the QE process, the slowdown in economic growth and the tightening of the global financial situation also led to further deterioration of debt risk.
According to Bloomberg data, after the total debt issuance in 2013 fell from $7.6 trillion in 2012 to $7.43 trillion, the G7 plus the top 12 economies of Brazil, Russia, India and China will issue bonds in 2014. It is almost the same as in 2013. After taking interest, the debt refinancing of the 11 countries will increase by about 712 billion U.S. dollars to 8.1 trillion U.S. dollars in 2014. At present, global bond yields are beginning to rebound from record lows, which will inevitably lead to rising borrowing costs and debt crisis risks, which is a very important manifestation of global financial fragility in 2014.
Debt risk is still threatening global finance
Abstract After the Spring Festival, the global financial market is still shrouded in many risks. Old and new problems are intertwined, and old risks and new risks are superimposed. Among them, sovereign debt risk remains the main cause of global financial fragility. According to the IMF forecast, in 2014, the total debt of developed economies...
After the Spring Festival, the global financial market is still shrouded in many risks, old problems and new problems are intertwined, and old risks and new risks are superimposed. Among them, sovereign debt risk remains the main cause of global financial fragility.