World Markets Celebrated This Week as Trillions of Dollars in Debt Became More Expensive to Service

The very essence of the bear case stems from the inescapable fact that sovereign debt loads are an albatross around the necks of governments. It prevents them from enacting fiscal stimulus, or lowering taxes, because of the massive amount of debt against GDP. Almost every single western nation is deficit spending, so the debt bubble is only getting bigger. Although I do appreciate the vigor of market participants this week, celebrating the ascension of the golden hair’d lion, the rise in sovereign yields only make matters worse.

It has always been my position that rates could not rise, due to this burden. If, in fact, they did rise, it would only constrain fiscal spending, quickening the debt/gdp problem, making entitlement spending an issue during political elections. It is my belief the rise of populism around the world coincides around this core problem: the great transfer of wealth from west to east.

The greatest civilizations the world has ever known have been reduced to a merry group of latte drinking consumers — lining the corrupt pockets of multi-nationals.

Here are the 10yr yield changes amongst some of the most indebted nations in the world. Explain to me how a sharp increase in their big sovereign credit card yields is a good thing for stocks.

Debt to GDP / 10 year bond yield change (1 week)

Japan 229 (-0.08% to -0.02%)
Italy 132 (1.75% to 2.02%)
U.S 104 (1.7% to 2.13%)
Spain 99 (1.2% to 1.49%)
France 96 (0.5% to 0.75%)
Canada 91 (1.2% to 1.43%)
U.K. 89 (1.2% to 1.36%)
Germany 71 (0.15% to 0.31%)
Portugal 129 (3.2% to 3.49%)
Belgium 106 (0.40% to 0.69%)
Singapore 105 (1.9% to 2.35%)
Ireland 93 (0.65% to 1%)
Austria 86 (0.35% to 0.58%)
Hungary 75 (3.1% to 3.5%)
Brazil 66 (11.5% to 12.25%)
Netherland 65 (0.25% to 0.49%)
Finland 63 (0.30% to 0.51%)