sovereign default

Top 10 Riskiest Sovereign Debt

A report by CMA Vision evaluates the risk of sovereign default globally.

The top 10, with a probability ranking of default within 5 years are:

  1. Venezuela 57.7
  2. Ukraine 54.6
  3. Argentina 49.1
  4. Latvia 30.1
  5. Iceland 25.4
  6. Dubai 25.1
  7. Lithuania 19.3
  8. Greece 17.4
  9. Romania 17.2
  10. Lebanon 17

Both Greece and Romania are new entries into the top 10.

Of the world's safest sovereign debt, the United States ranks 8th. Norway is #1. In fact all of those silly socialist countries are ranked in the top safest.

The report notes:

Both the USA and UK have been among the worst performing sovereign CDS this quarter- the UK is some 77% wider, the USA out by nearly 66%.

Dubai considers debt default

I don't think anyone saw this one coming.

(Bloomberg) -- Dubai shook investor confidence across the Persian Gulf after its proposal to delay debt payments risked triggering the biggest sovereign default since Argentina in 2001.

The scary thing is that if it can happen to Dubai it can happen to almost anyone.

Gulf region default swaps jumped, with contracts linked to Bahrain adding 29 basis points today to 223.5, the biggest increase since Feb. 18. Contracts linked to Abu Dhabi added the most since February yesterday, climbing 36 basis points to 136.5 and were another 23 basis points higher at 159.5 today, according to London-based CMA. Qatar default swaps rose 13 basis points to 117, adding to yesterday’s 11 basis-point increase.

United States Risk of Default Jumps

Think the unthinkable. U.S. default risk jumps on govt loan purchase plan.

Long-dated Treasuries rallied with the 30-year bond jumping more than 3 points

The cost to insure against $10 million of debt issued by the U.S. government jumped to 47.5 basis points or $47,500 per year for five years, according to credit data company CMA DataVision. This compared with 43.5 basis points or $43,500 late Monday.

Credit default swaps insuring $10 million of U.S. Treasuries edged up to a record 50.0 basis points or $50,000 a year for 10 years

Earlier, before these latest expenditures, CNBC wrote a story that the U.S. might lose it's AAA credit rating.