Paying back those bonds, however, is an ongoing obligation of the state, and the payments, estimated at $65 million, have to be paid out of the state general fund. Conroy noted that the state is paying roughly 4.7 percent annual interest on those bonds, and that's another reason why many people are watching the investment returns closely.
The report showed that defined-benefit pension plans across the European Union were on average only 75 percent covered by assets at the end of 2014. According to Bloomberg Intelligence, many schemes will likely have deteriorated since then.
A benchmark for near-term borrowing, the three-month U.S. dollar London interbank offered rate, has risen above 0.75 percentage point. That’s a key threshold for junk-rated companies with about $230 billion of loans outstanding according to data compiled by Bloomberg — with Libor above that level, the borrowers will have to pay more interest over time.
The trend is most apparent in the energy sector where oil and gas companies have been deploying a raft of creative measures to stay afloat amid lower crude prices that have crimped profits and threatened their survival. Such measures have included swapping unsecured debt for secured, offering discounted buybacks of existing debt, or junior-lien debt that gets paid after other creditors.
A tripling of student debt over the past decade to more than $1.3 trillion has unleashed a torrent of Washington lobbying from outside the education sector, with various industries describing a “crisis” requiring federal intervention.
Twenty countries have had their ratings cut so far this year by the major ratings agency. So far, this matches the tally for the whole of 2011 and the most since Fitch started record keeping in 1994.
The buildup has also exacerbated China’s swelling debt as cost overruns equal about a third of the nation’s $28.2 trillion debt mountain, according to the paper.
"There's only so much you can squeeze out of the debt cycle, and we're there globally," the head of Bridgewater Associates said at the Delivering Alpha conference presented by CNBC and Institutional Investor. "You can't lower interest rates more."
Government debt has surpassed 600 trillion won ($540.54 billion) for the first time, growing about 100 trillion won in two years, the finance ministry said Tuesday.
Indeed, consumers added a record $34.4 billion in credit card debt in 2016’s second quarter alone, the second-largest increase for that period since 1986. They added $71 billion to their credit card bills last year, the most since 2007. As a result, WalletHub says the average debt level per household will hit $8,500.
Pension scheme deficits are rising across Europe as the income they make on government bonds shrinks. Pension funds typically stock up on government bonds because they are perceived to be a safe investment. But the yields on government bonds have been falling as extensive central bank buying pushes them down
Brazilian President Michel Temer is turning to an unlikely source to help solve his country’s fiscal crisis — deadbeat taxpayers.
Investors who refused to swallow negative yields to hold Japan’s shorter-dated bonds are suffering, as an index of sovereign debt maturing in 20 years or more has lost 9 percent this quarter.
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