Category Archives: Bolivia

What Paraguay’s bond issue says about the state of Latam fixed income

Remember that Bolivia bond issue last October that had everyone’s attention for about five minutes? Well Paraguay is now following suit. Meanwhile Mexico’s Treasury ministry is bragging about how historically low yields are some sort of sign of economic health or whatever.

And hey, there’s other stuff happening with Colombia and Brazil, and Argentina’s managed to buy some time in the New York court system and there’s obviously a general global imbalance of sovereign access to debt markets, yes, I am aware of all those things and many more. But in the interest of keeping this tidy, I’m going to focus right now on the most recent Latam issues and attempt some level of streamlining.

So let’s look at some data first. This is as close as I can get to comparing apples to apples:

2013.01.22.Mexico Paraguay Bolivia bonds

And here’s a reminder direct from Mexico’s Treasury on the recent history of Mexican government bond yields at issue date:
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There’s one word for Emerging Markets Debt. And one way to hedge it.

2013.01.11.Emerging Markets debt bubbleEuromoney leads an Emerging Markets debt bubble story with this teaser:

“International money is flying into emerging market sovereign bond markets with frontier credits, such as Zambia, Mongolia and Bolivia, now boasting low yields. The jury is out on whether there is a bubble brewing in developing bond markets in hard currency.”

Um…personally, the jury is in if you ask me. It’s been in for quite a while and I don’t think anyone doubts that there is a bubble. The only question is when it’s going to pop. I mean, seriously folks. Disregard whatever spin you’re hearing from compromised money managers. The facts speak for themselves:
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Photo of the Day: Hugo, Evo and Rafael as the 3 Stooges

Thanks again to our resourceful readers, we have today the presidents of Venezuela, Bolivia and Ecuador–Hugo Chavez, Evo Morales and Rafael Correa–as the Three Stooges:

If there’s anyone who cares to photoshop these three plus Fidel Castro into the Marx Brothers, by all means please don’t be shy.