France Issues 10% of its Debt in Inflation-Indexed Securities

In our last article, we explained how Banque de France owned close to 20% of the country’s debt and how that part was growing rapidly – some financial cavalry that doesn’t bode well. This time – here exclusively because it is not mentioned anywhere else in the media – here’s new proof of the incompetence of French governments to manage the country’s debt. It is often said that a good wave of inflation helps cleaning out the debts – history has proved it many times. When prices remain high for a number of years the real value of public debt shrinks to almost nothing. But, however, this will be impossible from now on, because the State has forfeited this possibility – it even put a knife to its own throat in case of hyperinflation. In October, 2001, the French Treasury had the very unfortunate idea of launching the first bond indexed on the Euro zone’s price index – OAT€i. “Classic” Treasury bonds, OATs (Treasury convertible bonds), are issued at a fixed rate. If rates...

from GoldBroker.com https://www.goldbroker.com/news/france-issues-10-percent-its-debt-inflation-indexed-securities-insane-risk-1292