EconoMonitor

The Wilder View

Latest Posts Archives Contact RSS Subscribe

The European Debt Crisis in Charts

Author: Rebecca Wilder  ·   ·   › Share This Print

I present some basic statistics to highlight the problem in Europe. In short, there exists a deleterious positive feedback loop between overly leveraged banks and their sovereigns in key markets.

Exhibit 1: European Banks are overly levered. Spanning 2006 through the latest data point, key European banking systems – France, Germany, and Italy – increased leverage.

The chart above illustrates the ratio of bank assets to capital (see the IMF’s Financial Soundness Indicators for the data and description of ‘capital’). The countries are ranked by largest % drop in bank leverage spanning the period 2006 to current (Greece, Austria, and Belgium) to the largest % surge in leverage spanning the same period (France, Italy, and the UK). Note: the 2006 data is taken from the 2007 IMF Global Financial Stability Report.

The level of leverage is not strictly comparable across countries due to differences in national accounting, taxation, and supervisory regimes. However, while the US banks have delevered over the period, the big European banks – Germany, Italy, and France – have increased leverage. Assets need to be written down.

Exhibit 2. While leverage is too high, asset quality is dropping. The banks are increasing exposure to government loans and securities relative to traditional loans.

The chart illustrates the nominal stock of loans held on the bank balance sheets of the Monetary Financial Institutions in Europe. The data are from the ECB. Loans to governments and holdings of government securities are increasing more swiftly than traditional lending.

Exhibit 3. The asset quality of that rising stock of loans to the government sector is deteriorating…quickly. Italian and Spanish 10yr bonds are 1.5% and 1.2% higher, respectively, since the beginning of 2010, while German 10-yr yields are 1.5% lower.

The chart illustrates the 10-yr bonds across the euro area bond markets. The latest data point (today around 12pm) is listed in the legend.

Bond investors are clearly differentiating between the riskier bonds – Spain, Portugal, and Belgium – from the ‘core’ – Germany, Netherlands, Austria, Finland, and yes, France. Whether or not bond markets are right to regard Finland or France as ‘core’ is a different matter entirely. But the point is clear: bond markets are in crisis mode, and there’s a stark segmentation in yields across the region.

Cross border exposure dictates that some of these highly levered banking systems are exposed to the same government securities currently trading at distressed levels. A case in point is France with outsized exposure to Italy and Greece (see Table 9B). This is a helpful graphic by Thomson Reuters .

This post originally appeared at News N Economics and is reproduced here with permission.

Filed under: Uncategorized

116 Responses to “The European Debt Crisis in Charts”

BuzzToSave • September 26th, 2011 at 5:30 pm

I’ll immediately grab your rss feed as I can not in finding your e-mail subscription link or newsletter service. Do you’ve any? Please permit me recognise so that I may just subscribe. Thanks.

LittleBlueKangaroo • September 26th, 2011 at 6:14 pm

Nice post. I used to be checking constantly this blog and I’m inspired! Very useful info specifically the remaining phase :) I handle such information a lot. I used to be seeking this particular information for a long time. Thank you and good luck.

Wholesale Beads • September 26th, 2011 at 8:58 pm

I think the right time to go to BAKPAKHISTAN is the time when they are celebrating their festival of grain by the time we can feel the richness of their culture, their typical life ,craft and carpets.

Painting Companies Denver • September 26th, 2011 at 9:57 pm

I would like to thank you for the efforts you’ve put in writing this website. I’m hoping the same high-grade site post from you in the upcoming also. Actually your creative writing skills has encouraged me to get my own site now. Really the blogging is spreading its wings fast. Your write up is a great example of it.

deepchill frizzy hair treatment • September 26th, 2011 at 10:29 pm

Today, my Hero, you have an enormous opportunity in your hand to contribute towards the ‘”history” of our great nation. You have so much information in your head and more importantly, accesses to information, regarding what ‘wrongs’ are done in the upper tier of our society.

home warranty • September 26th, 2011 at 10:30 pm

You actually make it seem really easy together with your presentation but I in finding this matter to be really something that I believe I might by no means understand. It seems too complex and very huge for me. I’m having a look ahead on your subsequent submit, I’ll try to get the hold of it!

Pole Dance DVD • September 26th, 2011 at 10:48 pm

There has been a comment on the boards that says it should have been called Maximum Ride: a compilation of every fanfic ever written. Similar to SWOES, it is easy to see where elements in the books were also used in fanfiction, prior to said books release. Either JP is plagiarising his fanfiction authors or hes really predictable with his plotlines The Martinezs being Maxs family, for one example. Hell, that one was FFicced after BOOK ONE. Personally, I hope its the latter, because the former if a multimillionaire writers looking at his fans for a plot, theres something seriously wrong.

dental implants london • September 26th, 2011 at 11:49 pm

Wow that was strange. I just wrote an really long comment but after I clicked submit my comment didn’t appear. Grrrr… well I’m not writing all that over again. Anyways, just wanted to say fantastic blog!

cheap horse riding clothes • September 26th, 2011 at 11:58 pm

Thanks for one’s marvelous posting! I seriously enjoyed reading it, you could be a great author.I will be sure to bookmark your blog and definitely will come back later on. I want to encourage that you continue your great job, have a nice afternoon!

Galetta5635@hotmail.com • September 27th, 2011 at 12:08 am

Does your blog have a contact page? I’m having problems locating it but, I’d like to shoot you an email. I’ve got some ideas for your blog you might be interested in hearing. Either way, great site and I look forward to seeing it grow over time.

laser tooth whitening london • September 27th, 2011 at 12:26 am

Hey there! Someone in my Myspace group shared this site with us so I came to check it out. I’m definitely enjoying the information. I’m book-marking and will be tweeting this to my followers! Superb blog and wonderful design and style.

hover mowers • September 27th, 2011 at 12:34 am

With havin so much content do you ever run into any issues of plagorism or copyright violation? My blog has a lot of exclusive content I’ve either authored myself or outsourced but it looks like a lot of it is popping it up all over the internet without my authorization. Do you know any solutions to help prevent content from being ripped off? I’d genuinely appreciate it.

http://www.tokiohotel.com/us/forum/member.php?u=1152 • September 27th, 2011 at 12:47 am

Hi there just wanted to give you a quick heads up. The words in your post seem to be running off the screen in Ie. I’m not sure if this is a formatting issue or something to do with browser compatibility but I thought I’d post to let you know. The design and style look great though! Hope you get the problem resolved soon. Thanks

Gerry Springer • September 27th, 2011 at 1:46 am

I think its hard to argue with using a 4th round pick on Williams,especially when youre as thin at WR as Tampa. The kid put up huge numbers for some not-so-good Syracuse teams. If he gives them even average production say 40 catches/600 yards for a few years, it was a good pick.

plumbers Caldy • September 27th, 2011 at 1:56 am

Hi! This is kind of off topic but I need some guidance from an established blog. Is it hard to set up your own blog? I’m not very techincal but I can figure things out pretty fast. I’m thinking about setting up my own but I’m not sure where to start. Do you have any points or suggestions? Thank you

chester cosmetic dentist • September 27th, 2011 at 2:03 am

Howdy! Quick question that’s entirely off topic. Do you know how to make your site mobile friendly? My site looks weird when browsing from my iphone 4. I’m trying to find a template or plugin that might be able to correct this issue. If you have any suggestions, please share. Many thanks!

Steampunk • September 27th, 2011 at 7:17 am

There are definitely quite a lot of particulars like that to take into consideration. That is a great point to carry up. I provide the thoughts above as general inspiration however clearly there are questions like the one you carry up the place a very powerful factor can be working in honest good faith. I don?t know if greatest practices have emerged round issues like that, but I’m positive that your job is clearly identified as a good game. Each girls and boys really feel the impression of only a second’s pleasure, for the rest of their lives.

solicitors exeter • September 27th, 2011 at 10:06 am

I must express appreciation to this writer just for bailing me out of this condition. After searching through the world-wide-web and getting methods that were not powerful, I thought my life was gone. Living without the presence of approaches to the difficulties you’ve sorted out by way of your main website is a serious case, as well as those that would have badly damaged my entire career if I hadn’t encountered your web page. Your own talents and kindness in playing with all areas was precious. I don’t know what I would’ve done if I hadn’t come upon such a solution like this. I can also now look ahead to my future. Thanks very much for this impressive and amazing guide. I won’t be reluctant to propose your blog to any person who will need direction about this issue.

synthetic butyl rubber • September 27th, 2011 at 12:56 pm

Nearly all of whatever you articulate happens to be supprisingly accurate and it makes me ponder the reason why I had not looked at this in this light before. Your article truly did switch the light on for me as far as this specific topic goes. Nevertheless there is actually 1 issue I am not really too cozy with so whilst I try to reconcile that with the actual core theme of your point, let me observe exactly what the rest of your readers have to point out.Very well done.

Gucci Mane New Lyrics • September 27th, 2011 at 3:55 pm

I got what you intend, appreciate it for posting .Woh I am glad to find this website through google. “I would rather be a coward than brave because people hurt you when you are brave.” by E. M. Forster.

Selene Josic • September 27th, 2011 at 9:48 pm

The actual Honua Kai Vacation resort & Health spa may be the newest and best 5-star holiday resort about Offers – nothing else arrives even shut. The actual Honua Kai has become open for two and one half a few years is now your #1 vacation resort upon Northern Boasts as well as the #2 location like Maui — merely guiding the 4 Conditions inside Southern Offers that will run you four times just as much in order to hire and it is 1 / 3 the dimensions of the actual Honua Kai. The particular Honua Kai is a condo-hotel every apartment is privately owned and when the owner isn’t presently there your apartment can be place into your hire pool area. Located upon Ka’anapali Seashore the particular Honua Kai can be Thirty-five decades more recent than all of those other accommodations on the #1 beach front inside Offers. A great reference internet site non the Honua Kai can be – Honua Kai Resort & Spa

veterinary practice lincolnshire • September 27th, 2011 at 10:11 pm

I am really enjoying the theme/design of your web site. Do you ever run into any internet browser compatibility problems? A few of my blog readers have complained about my site not working correctly in Explorer but looks great in Chrome. Do you have any tips to help fix this problem?

Lilla Burling • September 28th, 2011 at 12:32 pm

Needed to post you the bit of remark to help thank you very much as before over the stunning guidelines you’ve shown above. It has been certainly particularly open-handed with people like you to offer openly precisely what a number of us could possibly have sold for an electronic book to generate some dough on their own, mostly now that you might have done it if you desired. The ideas additionally acted to be a good way to realize that other individuals have similar fervor just as my personal own to know lots more in respect of this problem. I’m certain there are lots of more pleasurable situations up front for folks who look over your blog.

Bibi Tindell • September 28th, 2011 at 2:01 pm

Thanks for the ideas you have shared here. Furthermore, I believe usually there are some factors that will keep your motor insurance premium lower. One is, to contemplate buying cars that are in the good listing of car insurance firms. Cars that happen to be expensive will be more at risk of being stolen. Aside from that insurance is also depending on the value of the car, so the more pricey it is, then the higher the actual premium you spend.

Best compact digital cameras • September 28th, 2011 at 2:04 pm

Its like you read my mind! You seem to grasp a lot approximately this, such as you wrote the guide in it or something. I believe that you can do with a few % to drive the message house a bit, but instead of that, that is wonderful blog. A great read. I’ll definitely be back.

Cary • September 28th, 2011 at 2:30 pm

Your post, EconoMonitor : The Wilder View » The European Debt Crisis in Charts, really made me stop and consider this topic. Not only was it well written but very informative as well. I have added your blog to my favs list and will be back to read future pieces.

BBQ SAUCE • September 28th, 2011 at 2:49 pm

When the time comes that left of center Jews stop looking to their right and worrying that danger lurks there, they might justmaybe, finally, wake up and realize that ALL the danger, 97% of the hatred, and all of the lies about them as a peopleis to their left.

tina • September 28th, 2011 at 3:57 pm

After I initially commented I clicked the -Notify me when new comments are added- checkbox and now every time a comment is added I get four emails with the same comment. Is there any means you can take away me from that service? Thanks!

REO Lake Mary • September 28th, 2011 at 7:55 pm

Great job, I just found your weblog and wanted to say that I’ve truly enjoyed browsing your blog posts. I will subscribe to your feed and I hope you write again very soon!

no contact formula • September 28th, 2011 at 8:08 pm

Why would anyone go to Barns and Noble or Boarders when you get the best selections of books, excellent service and delivery, plus you cannot beat the AMAZON prices. You get a tracking number and delivery on the date promised.

israel trip • September 28th, 2011 at 8:54 pm

You have some luring ideas on this matter and I took pleasure in reading EconoMonitor : The Wilder View » The European Debt Crisis in Charts very much. After finding your website on Digg, I have included it in my bookmarks in order to share it with friends.

Laminate Flooring Orange County • September 28th, 2011 at 10:37 pm

1. Lenins grandfather Alexander Blank, a Jew.2. Lenins closes Bolshevik accomplices and LEADERS of the Bolshevik Coup dEtat 1917, ALL were Jews: Kamenev, Zinoviev, Trotsky, Sverdolov, etc, etc, etc, etc.Trotsky was ONE OF SEVERAL Lenins Bolshevik accomplices who organized the monstrous Golodomor (Famine) in the Volga region in order to stifle the national liberation movement of local ethnic groups.

Hotels in Belfast • September 29th, 2011 at 11:32 am

Thanks for your useful article. Other thing is that mesothelioma cancer is generally brought on by the inhalation of materials from asbestos, which is a positivelly dangerous material. It is commonly observed among individuals in the engineering industry who may have long exposure to asbestos. It is also caused by residing in asbestos covered buildings for an extended time of time, Your age plays an important role, and some people are more vulnerable on the risk when compared with others.

Jim Vantrease • September 29th, 2011 at 4:20 pm

Thanks for the strategies you have discussed here. On top of that, I believe there are a few factors that will keep your insurance premium lower. One is, to take into account buying autos that are in the good report on car insurance corporations. Cars that happen to be expensive will be more at risk of being snatched. Aside from that insurance is also good value of your truck, so the more costly it is, then the higher the actual premium you spend.

back to basics shampoo • September 29th, 2011 at 7:53 pm

3) Shadows in the second pair of photos (standing man) are consistent with the sun coming from the right at more than 45 degrees above the horizon. The questionable aspect is the dark right rib cage area, which could not be a shadow given the sun location.

Healthy • September 29th, 2011 at 8:52 pm

It would make more sense if a tram is used other then using it as a tourist attraction. Its better we could ride on that old tram. Scrap the SUBWAY nonsense!! SCRAP THE MONORAIL!

Lg infinia 55lx9500 • September 29th, 2011 at 9:51 pm

of course like your web site but you need to check the spelling on several of your posts. A number of them are rife with spelling problems and I find it very troublesome to tell the truth nevertheless I¡¯ll definitely come back again.

turbulence training • September 30th, 2011 at 1:44 pm

Make sure you get involved in a competition for one of the greatest information sites on the web. I’d entirely advocate this great site! Furthermore, I brought up yourself on my own Bebo profile, ideally this is cool.

tarot • October 12th, 2011 at 8:49 pm

Sorry for the huge review, but I’m really loving the new Zune, and hope this, as well as the excellent reviews some other people have written, will help you decide if it’s the right choice for you.

Clelia Peale • October 19th, 2011 at 11:39 am

I have done extensive research on this subject, and agree completely with the way this was written. I only wish I had the eloquence to put it into quality writing.

click here • November 11th, 2011 at 1:19 pm

Check this out…

[...] that is the end of this article. Here you’ll find some sites that we think you’ll appreciate, just click the links over[...]……

Denver SEO • December 31st, 2011 at 12:32 am

Illuminating piece – thanks a lot for this great insight, Rebecca. I remember studying the European debt crisis back in college, and would have loved to have this site as a resource. Keep up the great work!

prezent • January 4th, 2012 at 8:36 pm

Wonderful goods from you, man. I’ve understand your stuff previous to and you are just too excellent. I really like what you’ve acquired here, certainly like what you’re saying and the way in which you say it. You make it enjoyable and you still care for to keep it wise. I can’t wait to read much more from you. This is really a great site.

rapid hitch • January 4th, 2012 at 9:10 pm

I am often blogging and i really appreciate your content. The article has really peaked my interest. I am going to bookmark your site and keep checking for new information.

Leave a Response

Monitoring the Global Economy

EconoMonitor Favorites on Twitter
@economonitor/our-favorites
Sudeep Reddy Reddy
"Europe could quickly become a hotbed of widespread social unrest." http://t.co/I5i9HIKO
Daniel Gross grossdm
Things I learned in the FT: "A single Chinese brewer sold more beer last yaer than was sold in Germany." Snow Beer.
zerohedge zerohedge
Bankia shares suspended amid bailout request reports http://t.co/A0JWNMIE
zerohedge zerohedge
BKIA SM € s Suspended by the Regulator.
1 minute ago
Roubini Global RoubiniGlobal
#RGE: "Rcent moves of the Russian government to raise taxes on gas may also fuel inflationary pressures" http://t.co/ehOvYWPX
1 minute ago
Sudeep Reddy Reddy
Even the bullish case for Europe in Foreign Affairs says "European integration is reaching a natural plateau" http://t.co/IB5eWC2p
2 minutes ago
Niall Ferguson nfergus
In Toronto for tonight's Munk debate on Europe's failed experiment. You can watch at http://t.co/rzNqDsBg. Kick-off 7pm Eastern time.
3 minutes ago
Mark Mobius MarkMobius
I think title rights, econ surpluses, citizens’ charters & clarity in law, key factors to help end corruption in India http://t.co/3ESFb9Mu
3 minutes ago
Bloomberg News BloombergNews
Deutsche Bank’s co-CEO says Greece is a "failed state." Do you agree? | http://t.co/Wy7n2Ixk
3 minutes ago
zerohedge zerohedge
ACCUSED COACH SANDUSKY'S CHARITY ANNOUNCES IT WILL SHUT DOWN
5 minutes ago
Paul Kedrosky pkedrosky
It's not just you: Pop music is getting longer, slower and sadder - http://t.co/OfUP2rFP /via http://t.co/FNQFC7DM
6 minutes ago
Barry Ritholtz ritholtz
America’s Presidential Race http://t.co/1oLXQt8C $$
6 minutes ago
Robin Bew RobinBew
How many companies fail because their organisation and strategy stay the same as the external environment shifts? #gsmp2012
6 minutes ago
Project Syndicate ProSyn
Check out our Focal Point " #Germany vs. #Europe" for expert analysis of the rising tensions in the #eurozone. http://t.co/ZtrQ41T9.
8 minutes ago
Stocktwits StockTwits
RT @MercenaryMike Verifone Systems weak guidance certainly helps confirm bearish perspective on retailers $PAY $RTH
11 minutes ago
Financial Times FT
Namedrop Friday: Coming up in FT Weekend - Paul Krugman, Anya Hindmarch, Gordon Ramsay, Zaha Hadid and Ken Loach
11 minutes ago
felix salmon felixsalmon
I like @ruthlessgravity's response, #Grexit on Jan 1 would require an irrevocable decision to exit before then @TheStalwart
12 minutes ago
Blake Hounshell blakehounshell
Will anyone be brave enough to defend poor, defenseless private equity firms?
12 minutes ago
NPR's Planet Money planetmoney
Our brand new iPhone app is here, and we couldn't be more excited! Check it out http://t.co/jfeX4srh
12 minutes ago
World Economic Forum davos
Can we get to zero poverty by 2030? East Asia has led the way with figures dropping since 2005 @mcarthur #WEF http://t.co/eVck99rl
13 minutes ago
Blake Hounshell blakehounshell
"Is this the freedom you want?" Bashar's likely message to Syrians today. #Egypt
13 minutes ago
Peterson Institute PIIE_com
US #Anti-Dumping Duties on #Chinese #Solar Cells: A Costly Step | by Gary Hufbauer & Martin Vieiro http://t.co/00ghB2Li
15 minutes ago
zerohedge zerohedge
Who thought the end of fiat would be so funny http://t.co/iD8XBRLq
15 minutes ago
Stocktwits StockTwits
RT @SeemaCnbc $DECK +5%, what's the trade & whats the news? Trending on @stocktwits http://t.co/LfC6pWUk
16 minutes ago
Eurasia Group EurasiaGroup
.@ChinaDailyUSA has a nice photo of @ianbremmer's @AsiaSociety event yesterday: http://t.co/Yp1lrv7x . @AsiaSocietyNY #gzero
18 minutes ago
Wall Street Journal WSJ
Apple CEO Tim Cook turned down $75 million in dividends. His compensation last year: $378 million. http://t.co/rl98x6w8
18 minutes ago
Barry Ritholtz ritholtz
HOLY SHNIKES! SHEILA BAIR SAYS Breaking up Chase: Good for shareholders and taxpayers http://t.co/Cjv3aJWJ via @FortuneMagazine $JMP $$
19 minutes ago
Paul Kedrosky pkedrosky
Hugely geeky, but interesting slides: Skeuomorphs, Databases, and Mobile Performance http://t.co/qkNAhoYG
20 minutes ago
Roubini Global RoubiniGlobal
Bankia shares were suspended today by Spain's regulators ahead of a board meeting to approve a recapitalization plan http://t.co/b3WzyocI
21 minutes ago
Blake Hounshell blakehounshell
RT @davidplotz: The bonkers legal case that could force 1.2 million Canadians into marriage--against their will. http://t.co/Dqrgo6QD
21 minutes ago
dealbreaker dealbreaker
JPMorgan Risk Committee Directors Big On Life Experience, Wall Street Experience Less So http://t.co/uez2al51
22 minutes ago
Baseline Scenario baselinescene
"@washingtonweek: What books do our panelists recommend this summer? Find out in our Summer Reading List: http://t.co/eIb3ApOf" #whburning
25 minutes ago
Financial Times FT
US consumers most optimistic in four years http://t.co/7deEbRVS
25 minutes ago
zerohedge zerohedge
European Stocks On Verge Of 50%-Off Greek Light Special http://t.co/LslTjiL2
25 minutes ago
Foreign Policy FP_Magazine
Who are you rooting for: the Irish twins in tin man jumpsuits or the singing Russian grannies? http://t.co/JqhQ99vW
26 minutes ago
Bloomberg News BloombergNews
Merkel may compromise on euro debt-sharing plan | http://t.co/8YKiaANg
26 minutes ago
Blake Hounshell blakehounshell
Everyone's talking about how lazy you are. RT @TheStalwart: I'm so out of sorts having slept in. Can someone tell me what's driving the day?
26 minutes ago
PIMCO PIMCO
Gross: Greece captures the headlines but China may be a far bigger headache as growth slows.
27 minutes ago

Most Read | Featured | Popular

Blogger Spotlight

Edward Hugh Don't Shoot the Messenger

Edward is a macro economist, who specializes in growth and productivity theory, demographic processes and their impact on macro performance, and the underlying dynamics of migration flows. Edward is based in Barcelona, and is currently engaged in research on aging, longevity, fertility and migration, and the impact of all of these on economic growth.

Economics Blog Aggregator

Our favorite economics blogs aggregated.