China Owned the Decade in Bonds as U.S. Kept Equity-Market Grip
- U.S and Europe have reduced debt levels since the 2008 crisis
- But China and other emerging markets have piled into the void
Photographer: Feng Li/Getty Images
This article is for subscribers only.
The decade after the global financial crisis has produced a tectonic shift in debt markets: While banks and consumers across the U.S. and Europe deleveraged, Chinese borrowers went on a binge.
Bonds issued by Chinese entities account for about 12% of debt securities outstanding, up from 2% in 2007, according to the most recent data available from the Bank for International Settlements. The U.S. share dropped by 4 percentage points to 36% while the EU’s shrank by 8 percentage points to 24%. The moves contrast with the relative surge in value of U.S. equities.