Everything that needs to be said has already been said.
But since no one was listening, everything must be said again.

Andre Gide

Thursday, September 30, 2010

NEWS FLASH: Archduke Franz Ferdinand Found Alive! -- WWI a Mistake!!

Well, the headline this morning was not quite so dramatic. But still rather interesting; see here: Germany Closes Book on WWI with Final Reparations Payment. I had no idea. (Btw, I heard on NPR that this debt is largely in private hands, so no payments are actually being made to governments).

Now, if only Russia will do the same; see here: French Holders to Sue over Czar's Bonds.
"The Russian state owes French people a lot of money, and there is no date limit for that, even if some of this debt is more than 100 years old..."  
The French--they never forget these things.

I wonder what is presently the oldest official piece of outstanding debt out there, where bondholders actually hold some hope (possibly irrational) of eventual redemption?  Confederate bonds? Help me out, you historians...


  1. http://www.chicagofed.org/webpages/publications/working_papers/2009/wp_12.cfm

  2. and by the way world war II ended recently


  3. Good post, nice link by anon to that old French outstanding debt.

    Germany would still be paying down its debt if the US hadn't abrogated the gold clause. Originally, Germany's reparations were payable in the gold price of whichever currency in which the debt was denominated. When the terms were renegotiated in the 1950s, the abrogation of gold clauses meant that all German debt was to be made repayable in US dollars, not the gold value of US dollars. This was lucky for Germany since the debt burden proceeded to be inflated away. If still payable in gold, Germany's reparations would still be significant. Especially with gold at $1300.

  4. Nicholas Kaldor was a very conservative investor. No animal spirits in him.

    He switched from cash to buy Japanese government bonds soon after the atomic bombings in Japan because the bonds were indeed very cheap but Japan was bound to rebuild again and need to repay the bonds to borrow again.

    Bruno Fry leads a great literature on wartime bond prices in bond markets in neutral countries to pick tuning point in wars dating back as far as the civil war.