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Bloomberg Markets Magazine

Bloomberg Markets Magazine April/May 2019

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United States
Bloomberg Finance LP
Back issues only

in this issue

1 min.
the debt issue

Bloomberg Markets has a new look. After three years of covers that featured some of the most powerful people in finance and economics, we’ve switched to a focus on the big themes that matter in our world. In this issue we’re tackling global debt, now estimated to be more than three times the size of the world economy. Contributors around the globe examine the topic from a variety of perspectives. Djibouti, a tiny, poor country at the eastern edge of Africa, is in hock to China—creating a geostrategic challenge to the U.S. and France, reporter Nizar Manek finds in “China by the Red Sea” (page 62). Beijing, meanwhile, is no longer a guaranteed backstop for debt at home, forcing fixed-income investors like Chen Yang to learn credit analysis, explain Bloomberg News’s…

1 min.
markets almanac

Apr 17 Find the country’s economic statistics at {ECST ID <GO>}; a guide to its economy at {COUN ID ECO <GO>}; and the 10-year bond {GTIDR10Y <Govt> GY <GO>}. Indonesian Election Indonesia President Joko Widodo has put economic progress at the center of his pitch for another term 17–18 OPEC Meeting Vienna 176th Extraordinary Meeting of the OPEC Conference May 6 Sohn Investment Conference New York 24th annual gathering of investors raising money to help end childhood cancer 7–10 Use {PEOP <GO>} to search for people; {BIO <GO>} to get the biographical details of an individual; or {TOP WHO <GO>} to find people-related news. SkyBridge Capital’s SALT Conference Las Vegas Investment managers mingle with current and former government officials 14 Platinum Week Begins London Annual gathering of platinum and palladium miners and traders at Guildhall 23 India’s Election Results India Scheduled announcement of results from elections being held from April 11 to May 19 Jun 1 UEFA Champions League Final Madrid Real…

6 min.
what will cause the next debt crisis?

FOR HER CBC MASSEY LECTURES in 2008, Canadian writer Margaret Atwood chose to talk about debt. The text, written in the first half of the year (and later published as Payback: Debt and the Shadow Side of Wealth), described how she’d noticed a lot more ads on public transportation for debt relief services. “Why are there so many of these ads? Is it because there are unprecedented numbers of people in debt? Very possibly,” she said. Today, more than 10 years after the global debt-driven financial crisis that Atwood intuited, angst remains. Central banks that bought bonds and kept interest rates low to spur economic recovery have fueled record levels of corporate and government borrowing. While Atwood’s lectures considered debt from historical, theological, literary, and even ecological perspectives, we asked…

6 min.
europe needs a new italian renaissance

IF YOU’RE SEEKING the key to the euro zone’s economic outlook, all roads lead to Rome. Italy’s public debt of €2.4 trillion ($2.7 trillion) is significantly bigger than its economy and among the largest in the currency union, making it the most dangerous. This debt mountain threatens the financial stability of Italy and the future of the euro: Any plans to strengthen the single currency must solve the question of who will bear this burden. For centuries, it was bankers from the Italian peninsula who helped foreign states handle their finances. Luca Pacioli, a Tuscan-born Franciscan friar, is widely considered the father of modern bookkeeping thanks to his work on the double-entry system. The Medici lent extensively to royalty across Europe, including the French and the English. In 1340, King Edward III…

2 min.
seed capital

THE LOAN OFFICE at Happy State Bank, the only bank in Silverton, Texas, has barely changed in the 73 years it’s been open. About 90 percent of the farmers in Briscoe County rely on loans to pay for each season. “Once a year, we’ll do equipment, cattle, and crop inspections,” says Kyle Fuston, branch president. “After the crop is up and running, come midsummer, we’ll go out and look at it just to make sure. If we go out there and there’s hardly any crop out, and the farmer’s still borrowing money, then we have a problem.” Lane Garvin, a local farmer, says the water level has been dropping since wells were drilled in the 1950s. “We started rotating crops and using drip irrigation so we can grow more with less water,”…

5 min.
are the bond vigilantes really dead? (and did they ever actually exist?)

“I USED TO THINK if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everybody.” That was political strategist James Carville back in 1993. Younger readers might find the characterization of the bond market from a quarter century ago a bit bemusing. For them, the “bond market vigilantes” are little more than figures in a scary story that grizzled fixed-income investors use to keep young folks on the straight and narrow. After all, the Bloomberg terminal is full of bond quotes offering almost absurdly low yields despite elevated levels of public debt. As the public policy debate shifts to the possibility of increased spending in many parts of…