Sovereign defaults could start where nobody's watching [UPDATED]

According to this slideshow from CNBC, a lot highly leveraged/indebted countries are not currently under the radar of most. Here's a list of the 20 most debtor nation according to CNBC (data might need to be checked, and off-balance debt and liabilities added - pensions/social securities/etc. which don't appear as debt on many sovereign countries).

Country External Debt to GDP External Debt per capita Gross Q2 2009 external debt
United States 94.3% $44,000 $13.5 trillion
Hungary 105.7% $21,000 $210 billion
Australia 111.3% $42,000 $900 billion
Italy 126.7% $40,000 $2.3 trillion
Greece 161.1% $52,000 $553 billion
Spain 171.1% $60,000 $2.4 trillion
Germany 178.5% $63,000 $5.2 trillion
Finland 188.5% $70,000 $365 billion
Sweden 194.3% $74,000 $670 billion
Norway 199% $117,000 $550 billion
Hong Kong 205.8% $90,000 $631 billion
Portugal 214.4% $47,000 $507 billion
France 236% $78,000 $5 trillion
Austria 252.5% $101,000 $832 billion
Denmark 298.3% $110,000 $607 billion
Belgium 320% $119,000 $1.25 trillion
Netherlands 365% $147,000 $2.5 trillion
United Kingdom 408.3% $148,000 $9 trillion
Switzerland 422.7% $176,000 $1.34 trillion
Ireland 1,267% $568,000 $2.4 trillion
  • I have rounded some figures, mostly the debt per capita
  • Q2 2009 debt is way outdated, since the second half of 2009 was a real collapse in tax income and that 2010 is likely as bad...
  • Anybody who lends to any of these countries exposing himself to losing a big part of his investment, for a yield completely ridiculous compared to the risk.
  • The scandinavian model praised on all the newspapers and by most socialist-economists is actually a big failure and scandinavian failures will most likely default at the same time as many European countries...
  • While I have kind of forecasting a default coming from Denmark, I wasn't aware that Belgium and Netherlands where in such a big hole.
  • Who knew for Switzerland? How did they dig in such a deep hole for themselves? Are people investing in the CHF totally insane?
  • Ireland is bust
[Update] My friend "blbl" points me to this Wikipedia entry containing a list of countries by gross (i.e. total) external debt and by external debt per capita. It also provides the definition of external debt:
The external debt of a country is defined as the "total public and private debt owed to nonresidents repayable in foreign currency, goods, or services"
This is really important, as the debt also includes the private one (both individuals and corporations). It's not clear if it has to be in foreign currency or not, though I doubt it, given that the US for example, have only borrowed in their own currency.

He also thinks that Luxembourg and Switzerland are in the top list because they tend to attract lots of "shell companies" and their debt. Which makes sense I believe.


Anonymous said...

it is losing not loosing.

pej said...

Thanks anonymous.
Looks like Chrome doesn't have a spell checker on Mac yet...