Country Default Risk

Below is a table highlighting current credit default swap (CDS) prices for the sovereign debt of 38 countries.  The CDS prices represent the cost per year to insure $10,000 of debt for 5 years.  The US CDS price is quoted in Euros.  The list is sorted by year-to-date change, and as shown, default risk in Russia and Australia is down the most in 2009 at -77%.  US default risk is down 68.1%, which is the most of any G-7 country.  Japan is the only country that has seen default risk actually rise in 2009, but it also had the lowest CDS price of any country at the start of the year.  Overall, while CDS prices are down sharply in 2009, they remain well above where they were at the start of 2008, so there's still plenty of recovery work to do. 

 

Subscribe to Bespoke Premium to receive more in-depth research from Bespoke.

Comments

[Wrong]

Default? Right, in case they run out of paper and ink, maybe countries will decide to default instead of print money.

[yo]

two comments

1 where's canada?

2 interesting that germany is and has been lower than the US.

[Norman]

The default risk is in the entities that are making the guarantees, just like before. If the US does default how can that ever be paid off? Are we dumb or what?

[Nick Gogerty]

although not on the list, Norway is quite safe place relative to other CDS risk points.

[dj]

um, Yo, you must be new here...the small abcp market has been bailed out by the Canadian taxpayer (re Nat. Bank is still standing)

[Generic Viagra]

I would like to appreciate the great work done by You

[alternative investments]

I am surprised that the UK is so far down the list given our debt problems.

[ケアプロスト]

Your article is useful