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The world is running out of fiscal space

This is what global hot money sounds like… or put differently the “globalization of capital flows”… moving funds between asset classes and currencies to take advantage of changes in valuations and relative returns.

Does this type of financial activity add to nation’s wellbeing or does it just represent a “skimming” of a ¬†nation’s productive capacity?

Nikhil Srinivasan, chief investment officer for Asia and the Middle East at Allianz Investment Management, talks about Greece’s debt crisis, the global economy, and his investment strategy for stocks and currencies. He discusses how sovereign debt issuance is maxing out… balance sheets are full… ¬†“The world is running out of fiscal space“… trading sovereign debt has been a big play for global investors… and the trading of sovereign CDS is part of that… which the “too big to fail” banks dominate…

More on sovereign risk at Riski…

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