Since a month ago the cost of insuring against government bankruptcy through CDSs has risen for all but two countries (Lebanon and Argentina) in Bespoke’s list of 38 countries. The table below shows the current (December 4) CDS prices, together with month-ago and start-of-year prices. Argentina, Venezuela, and Iceland have the highest default risk.From Bespoke:
Interestingly, Germany, Japan, and France all have lower default risk than the US at the moment. It now costs $60 per year to insure $10,000 against US default for the next five years. “While this may not seem high, it was at $8 earlier in the year, and $36 one month ago,” said Bespoke.Click to enlarge Table courtesy of Bespoke
As shown in the table below, Ireland, Austria, Greece, and the UK have seen default risk rise the most over the last month. Notably, the US has risen by 68%.Click to enlarge Chart courtesy of Bespoke
As shown by table below, Morgan Stanley (MS) still has the highest default risk, followed by Goldman (GS), Citigroup (C), Merrill Lynch (MER), UBS (UBS), and Bank of America (BAC). While none of the firms below have CDS less than 100 basis points, HSBC, Deutsche Bank (DB), Wells Fargo (WFC), and JP Morgan (JPM) have the lowest default risk at the moment.Related Posts :Click to enlarge Chart courtesy of Bespoke
Sources :
- Investment Postcards from Cape Town: Credit Crisis Watch, December 8, 2008
- Bespoke: Country Default Risk Rises Across the Board, December 04, 2008 at 12:27 PM
- Bespoke: Bank and Broker Default Risk, December 10, 2008 at 11:02 AM
This is generally never true. Before buying or selling any asset you should do your own research and reach your own conclusion. See my Disclaimer on the bottom for more information.
You are welcome to republish this article, or any portion thereof.
Please, cite the actual/original source. I would be grateful if you could link back.
No comments:
Post a Comment