Friday, Nov 28, 2008
And so the buyers strike begins..........
Financial Times: UK and Italy struggle to entice investors
Quote:"The UK and Italy struggled to sell bonds on Thursday in a fresh sign of the difficulties governments are facing because of the debt needed for economic stimulus packages and bank recapitalisations. "
"Roger Brown, global head of rates research at UBS, said: “The UK auction was dire. I do not remember one as bad for shorter-dated bonds. It is an ominous sign of trouble ahead."
"Both the UK and Italian governments had to offer an extra 10 basis points compared with similar existing debt to entice investors to sell £3.75bn in four-year bonds and €1.4bn in three-year bonds respectively. The Italians also raised a lower amount than expected because of worries over weak demand"
Posted by goweresque @ 08:59 PM (614 views) Add Comment
4 Comments
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1. goweresque said...
Sorry, wrong link: correct one: http://www.ft.com/cms/s/0/f56403b0-bcab-11dd-af5a-0000779fd18c.html
2. mountain goat said...
very ominous indeed
3. stillthinking said...
Sheesh. Already? Maybe loony tunes Brown should abandon always announcing everything in advance. Everybody must know that there is a lot more debt issuance on the way so why waste their powder now.
Great find on the article.
GB isn't going to have much choice if this continues, he can either shrink our insane public sector, or push up borrowing costs. Worryingly I seem to read a lot about a debt servicing spiral for the UK.
Will he run the place into the ground? I am starting to think he will. This must be a huge blow because he has already confirmed the spending plans.... cunningly before he had the funds.
4. last_days_of_disco said...
Yeah, this is big big news. And its one of those little side stories. Without being able to sell debt, the UK can't go into debt. I think the game is up. It will take a while for the reality to actually bite and that is the dangerous time.