- Defaults are a regular part of the cycle
- Over time, currency has been moving away from assets to fiat
- Those more likely to default also tend to borrow more
- Governments can choose how to restructure their debt where companies cannot
- Additionally, there is no real way to force a government to repay
- Serial defaults are common in every region
- A lost war is the surest indicator of a pending default
- Modern defaults are shorter and don’t usually involve challenges to sovereignty
- Internal defaults are nearly as common as external defaults
- Internal and external defaults are associated with very different recovery behaviors
- Banking crisis strikes all countries, including advanced ones
- The Great Recession was the epitome of “This time is different”
- Crisis debt is more related to lower revenue and higher interest payments than recapitalizing the system
- “The stock market has predicted 9 of the last 5 recessions.”
Leave a Reply
You must be logged in to post a comment.