Finance

Frontier debt risks ‘going dark’ amid high costs and creative deals

Published

4 months ago

October 14, 2025

Frontier debt risks ‘going dark’ amid high costs and creative deals

LONDON/WASHINGTON, Oct 14 (Reuters) – The need for emerging economies to be more transparent about their debt is one issue uniting wealthy countries and multilateral lenders in a fractious, divided world where the international order and development finance face pressure.

The World Bank in June launched a call for “radical” debt transparency and the United States outlined transparency as a key goal for international financial institutions under President Donald Trump’s leadership.

But in the past several years, the riskiest of those nations – so-called frontier market countries – have been taking on more private, complex and “creative” debt arrangements that inadvertently undercut the visibility of the terms of their debt.

“Everybody loves transparency…(but) whatever the confidentiality clauses say, we are seeing a lot less of the documentation of commercial bank and other private lending,” said Anna Gelpern, a law professor at Georgetown University in Washington, D.C. who works on debt issues.

Collateralised lending to countries in strife that had dwindling options of raising funds causes particular issues, she added.

“That means that everything is going dark in terms of debt transparency.”

LIMITED ACCESS FOR BORROWERS

Countries from Panama and Colombia to Angola and Cameroon have sought to weather double-digit bond yields by seeking less conventional borrowing – from private placements to resource-backed loans or complex debt swaps requiring collateral.

While this is not on its own untoward, it means the terms of the debt – the cost, the collateral and even sometimes the tenure or amount – are not public.

This contrasts with international bond issuance where terms of the borrowing are published.

Some investors say the borrowing is a smart, sophisticated way to wait out times when bond markets might not be so easily accessible. But others warn this makes the total debt pile less transparent.

“With regards to collateralized borrowing, these kinds of hidden instruments, institutions like the IMF should be very worried about it, because they really then make the concept of preferred creditor very complicated,” said Reza Baqir, head of sovereign advisory at Alvarez & Marsal.

NET NEGATIVE, COST SAVING

The IMF estimated in a paper earlier this year that private lending to low-income countries outside international bonds as a percentage of their public and publicly guaranteed debt had risen to 10% by end-2023 from 6% at end-2010. Overall private lending – including international bond issuance – rose to 19% from 6%.

Victor Mourad of Citi said international bond issuance from Sub-Saharan African markets had been net negative – meaning governments raised less than they paid back – for the past three years.

Governments have sought cheaper funding sources – such as loans backed by development finance institutions such as the World Bank – and also more “creativity” via private placements and borrowing facilities in different currencies, though the alternatives they seek vary.

Nigeria has in the past secured oil-backed loans using crude oil cargoes as collateral. Angola opted for a $1 billion “total return swap” with JPMorgan, with privately placed bonds as collateral.

Aaron Grehan, co-head of emerging market debt with Aviva Investors, said Colombia and Panama had also avoided public debt markets, the former with dollar-bond buybacks and a total return swap, the latter with private placements.

Both had done well in these deals, he said, but will need to return to capital markets before too long due to the sheer amount they need. “You kick the can down the road,” he said.

When they return to public markets, investors will need to unpick their debt to try to determine what governments can sustainably borrow and repay.

“We have to do the homework and figure out if what is happening makes sense,” said Elina Theodorakopoulou, managing director and portfolio manager with Manulife Investment Management.

“If there is not enough transparency, that will be translated into the yield that you have to face if you were to access the market.”

Countries themselves say the deals have saved them money. Angola is still deciding on whether to extend its total return swap with JPMorgan, despite getting stung with a temporary $200 million margin call when oil prices slid.

“The cost of those financings is lower than the Eurobond,” said Dorivaldo Teixeira, general director of the public debt management unit at Angola’s finance ministry, while acknowledging the risks involved.

PUBLIC BORROWING, BUT HARDER TO ASSESS

At this week’s IMF and World Bank annual meetings in Washington, one of the issues the Global Sovereign Debt Roundtable will seek to tackle is the trouble of restructuring private debt.

That has snared Zambia and Ghana in default for longer than expected.

Sources said governments and advisors underestimated how hard it would be to unpick, determining who holds it, on what terms and whether there was collateral which can put one borrower ahead in the queue. This complicates debt reworks, in which all borrowers, ostensibly, must get equal treatment.

“It raises risks,” said Thys Louw, a portfolio manager with Ninety One. “Anything that’s marginally opaque adds complexity.”

Reporting by Libby George and Karin Strohecker, Additional reporting by Nell Mackenzie; Editing by Andrea Ricci

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Libby George is a London-based journalist on the Reuters emerging markets team. She was part of a team named as Pulitzer finalists in 2023, and who won the Selden Ring Award for International Investigative Reporting, for a series of stories revealing abuses by Nigeria’s military. After launching her career as a political journalist in Washington, D.C., she joined Reuters in 2015 covering oil, and from 2019-2023, she was senior correspondent and acting bureau chief based in Lagos, Nigeria.

Karin Strohecker is the London-based Global Chief Correspondent for Emerging Markets, leading a team that covers debt and economic issues and investment trends in developing nations around the globe. Having joined Reuters more than 20 years ago, Karin has worked in text and television in Frankfurt, Berlin and Vienna, covering major events such as IMF World Bank meetings in Washington, the World Economic Forum in Davos, OPEC meetings and the World Cup.

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Finance

These Stock Market Indicators Are Sounding the Alarm. Here’s What Investors Should Do Right Now. | The Motley Fool

Published

6 hours ago

February 8, 2026

Press Room

These Stock Market Indicators Are Sounding the Alarm. Here’s What Investors Should Do Right Now. | The Motley Fool

There’s no better time to start preparing your portfolio for volatility.

Stock prices may be surging, but many investors are having mixed feelings about the market.

While nearly 40% of investors still feel optimistic about the next six months, according to the most recent weekly survey from the American Association of Individual Investors, roughly 30% worry that stock prices will fall in the coming months.

Nobody can predict the future, especially the short term. But there are a couple of warning signs investors may want to pay attention to right now — along with some steps to prepare for a potential downturn.

Image source: Getty Images.

Will the stock market crash in 2026?

There’s no way to predict what the market will do this year, but it can sometimes be helpful to use historical context to get a sense of what’s happened in similar circumstances. And there are two stock market metrics that have not-so-good news for investors.

First, the S&P 500 Shiller CAPE (cyclically adjusted price-to-earnings) ratio. This metric is based on the average inflation-adjusted earnings over the last 10 years, and it’s commonly used to determine whether the S&P 500 is over- or undervalued. The higher the figure, the more overvalued the index may be.

Historically, the average Shiller CAPE ratio sits at around 17. As of February 2026, though, this metric is nearing 40. This is the second-highest value in history, next to the peak prior to the dot-com bubble in the early 2000s.

S&P 500 Shiller CAPE Ratio Chart

S&P 500 Shiller CAPE Ratio data by YCharts. CAPE Ratio = cyclically adjusted price-to-earnings ratio.

The second metric to watch is the Buffett indicator, which measures the ratio of U.S. gross domestic product (GDP) to the total market value of U.S. stocks. It was popularized by Warren Buffett, who explained in a 2001 interview with Fortune magazine how he used the metric to correctly predict the dot-com bubble burst.

“For me, the message of that chart is this: If the percentage relationship falls to the 70% or 80% area, buying stocks is likely to work very well for you,” he said. “If the ratio approaches 200% — as it did in 1999 and a part of 2000 — you are playing with fire.”

As of this writing, the Buffett indicator sits at 221%. The last time the metric neared 200% was in November 2021, just before stocks entered a bear market that would last nearly a year.

What should investors do right now?

No stock market metric is perfect, as past performance doesn’t predict future returns. Even if there are strong historical patterns suggesting a downturn could be looming, that doesn’t necessarily mean a crash, recession, or bear market is imminent.

Perhaps the best thing investors can do right now is ensure their portfolios are prepared for volatility, just in case. That involves double-checking that you’re only investing in stocks with strong fundamentals, such as:

Healthy finances: A company needs to be on a solid financial footing to survive an economic downturn. Shaky companies can still thrive when the market is surging, so stock price alone isn’t necessarily a sign of financial health. Now is a good time to comb through financial statements to review metrics such as profitability, debt, revenue growth, and other factors that can indicate whether a company is likely to survive tough economic times.
Competitive advantage: When the dot-com bubble burst in the early 2000s and much of the tech sector collapsed, the companies that survived were those that had a leg up over their peers. Organizations that didn’t offer anything unique or had nonviable business models crashed and burned, and the same could happen again if we face another significant downturn.
A strong leadership team: Sometimes, a company’s survival depends on the decisions by leadership during pivotal moments. Even a strong business may struggle if the executive team consistently makes poor choices, making this a key factor for long-term success.

The stronger your portfolio, the more likely it is that it will survive even the worst bear market or recession. By double-checking all your investments now, you’ll be prepared no matter what may lie ahead.

Finance

Letters on campaign finance, Minneapolis deaths, Oregon’s wildlife tax

Published

18 hours ago

February 8, 2026

Press Room

Letters on campaign finance, Minneapolis deaths, Oregon’s wildlife tax

Setting limits on campaign spending

Fifty years ago, the U.S. Supreme Court decided Buckley v. Valeo, legitimizing the idea that spending money in elections is a form of free speech. Thirty-four years later, Citizens United v. FEC went even further, granting corporations and unions, not just individuals, the right to spend unlimited sums to influence American elections.

These rulings, and the distorted view of the First Amendment behind them, have had serious consequences. Nearly $15 billion was spent in the 2024 election cycle alone, even as large majorities of Americans agree that money in politics is a threat to our elections. Here in Oregon, where we value civic participation and close-to-the-voter elections, it’s increasingly difficult for ordinary voters to compete with massive outside spending.

Even at the state and local level, Oregonians have limited authority over how money operates in our elections. That power has been centralized in the hands of unelected judges who were never meant to write election policy for the entire nation. It’s part of why everything feels so broken: a system where citizens cannot govern the rules of their own elections is not sustainable.

There is hope. A constitutional amendment would restore the ability of Congress and the states, including Oregon, to set reasonable limits on money in politics. Our nation is at a turning point, and we need to take action now. I encourage my fellow Oregonians to learn more about this vital issue, and urge our elected officials to support a constitutional amendment that will allow us to create common sense limits on the power of money in our elections.

Maud McCole, Eugene

Other things to consider about Good, Pretti deaths

While we all can agree that the deaths of the two protesters in Minneapolis were regrettable, it should be noted that those deaths were entirely preventable.

First and foremost, the incompetent and corrupt Biden administration allowed millions of illegal aliens into the United States without any sort of vetting or other means of identification.

Second, the sanctuary city policy of Minneapolis makes it very difficult for law enforcement to do their job. This, coupled with a fawning media and cowardly politicians cheering on and encouraging lawlessness, contributed largely to the deaths of Renee Good and Alex Pretti.

Raymond Moreno, Eugene

Support lodging tax increase for wildlife

The most important bill (to these readers) in the 2026 legislative session is HB 4134: “1% for Wildlife.” It adds 1.25% — less than the cost of a cup of coffee a day — to the statewide Tourism Lodging Tax (TLT). This legislation had bipartisan support in the 2025 legislature, but failed to get a floor vote in the Senate before adjournment. Funds raised with this fee go directly to Oregon Department of Fish and Wildlife for wildlife and habitat conservation. They assure a sustainable funding stream in the face of uncertain federal funds. This year’s bill adds .25% for wildlife stewardship and rehabilitation programs, including wolf depredation compensation.

Biological diversity — both floral and faunal — knows no geopolitical bounds nor ecological/economic bounds. Wildlife species, and their habitats, abound in Oregon. They transcend whatever artificial bounds we attempt to place upon them. Local, national, and international tourists visit throughout every year to enjoy our oceans, forests, valleys, mountains, watersheds, meadows, and deserts. Thus, in addition to the intrinsic ecological value of biodiversity, the economic value of our wildlife exceeds the investment to sustain it. From whale watchers to bird watchers, hunters to fishers, wildlife opportunities abound. Let’s make sure they stay that way.

Please urge your state representative and senator to vote YES on HB 4134.

David and Judy Berg, Eugene

Former Minneapolis residents horrified

As former residents of South Minneapolis, we are observing the horrifying, sad andgratifying events unfolding in real time; the horrifying killing of Renee Nicole Good, and Alex Pretti, then the sad adolescent, cruel and destructive response of the Trump administration and his sycophants.

What’s gratifying is to see the same savvy and united uprising of the activist neighborhood, many public officials, and the Twin Cities, and now in Eugene, Springfield, and the many other Oregon towns. Stay strong until ICE stands down and is held accountable.

“I’m not mad at you,” she said, and then Renee Nicole Good was dead …then Alex Pretti…???

Jan Nelson, Edward Winter and Rebecca La Mothe, all Eugene, et al.

Not all protesters are vandals

The First Amendment gives us the right to peacefully assemble and to petition the government for a redress of our grievances. To me, this is more than a right. It is my responsibility. If the citizens had not risen up in 1776 in the American Revolution, we would be an English territory under a king. That would have served the king well, but not the rest of us.

So I peacefully assemble and protest against anything that infringes on my freedom or the freedom of others; against anything that goes against the protections of the Constitution’s due process of law. I protest ICE and the many laws they break to meet quota.

I stand on the corner with my sign and I glory in the endless stream of cars honking in agreement and the occasional middle finger. It is invigorating to see the American spirit is alive and well.

Last Friday, during this peaceful gathering on Seventh and Pearl, a second, smaller gathering took place with a different approach at a slightly different location. They made loud noises and banged on the federal building office windows to the point of breaking the glass. The message was clear and the response was predictable.

I do not favor violence to any degree, from protesters or ICE agents. It draws attention away from the message we had congregated to express. But, I caution myself and others to not use disruption, broken windows or spray paint as an excuse to lump together the entire protesting world, imposing the identity of the minority with the entire movement.

Some people are horribly disturbed at the breaking of windows and spray paint. I’m against it, too. But I am more horrified at what is happening to citizens and guests in the U.S. by the violent and illegal grabbing of people off the streets — like they did in WWII Germany to the Jewish population. So if we are outraged at a broken window more than we are outraged at cruel and atrocious illegal arrests without warrant or due process, we need to rethink our stance and our purpose.

Candy Neville, Eugene

Not handouts, hands up

What if we could end homelessness — not with handouts, but with high school diplomas?

Research consistently shows that lacking a diploma is the single greatest risk factor for homelessness. Yet traditional education fails millions who learn differently. Global Sovereign University exists to change that.

GSU is a 501(c)(3) educational foundation built on one principle: teach a man to fish. Our free online platform meets learners where they are — whether they’re visual thinkers failed by rigid classrooms, adults seeking trade skills, or anyone overlooked by conventional systems.

What makes us different? Gamified learning that rewards progress. AI tutoring available 24/7. And “Civilization Builders” — retired professionals volunteering as mentors to share real-world wisdom with the next generation.

We don’t measure success by grades. We measure it by changed lives: someone landing their first job, a parent helping their child with homework, a veteran transitioning to civilian employment.

Education shouldn’t create dependency. It should build capability. GSU provides the tools; learners build their own futures.

Visit GlobalSovereignUniversity.org to learn more, volunteer as a mentor, or support our mission. Together, we can build a bridge to freedom—one learner at a time.

Dr. Gene A Constant, Eugene

Finance

Tesla Puts Its Money Where Its Mouth Is in the Biggest Way Possible | The Motley Fool

Published

1 day ago

February 7, 2026

Press Room

Tesla Puts Its Money Where Its Mouth Is in the Biggest Way Possible | The Motley Fool

Go big or go home has always been Tesla’s style, but this time it comes at a cost of saying goodbye to two instrumental models.

Investors will never be able to claim that Tesla (TSLA +3.50%) doesn’t shoot for the stars or go all in on its ambitions and vision. Even from its humble beginnings with only the Roadster for sale, plotting to one day reenergize an all-but-dead global electric vehicle industry, it aimed big. Now Tesla is doing it again, except this time its long-term sights are set outside of the automotive industry, and that comes with a cost.

Goodbyes are difficult

For investors who have been part of Tesla’s dramatic rise, it’s a bittersweet moment to say goodbye to vehicles that were instrumental in turning Tesla into the business it is today, while grappling with a future of humanoid robots, driverless vehicles, and artificial intelligence (AI).

Tesla announced it will end production of its high-end Model S sedan and Model X crossover in the second quarter and transform that California-based factory space into an assembly line for the Optimus robot, according to Tesla CEO Elon Musk. “It’s time to bring the Model S and X programs to an end with an honorable discharge. We are really moving into a future that is based on autonomy,” Musk said during the company’s earnings call in January.

Image source: Tesla.

Perceptive investors likely saw this move coming. After all, Tesla stopped accepting new orders for the Model S and X in China last April due to escalating tariffs — remember Tesla imports those two models into China, making them very expensive compared to the locally produced Model 3 and Y. As of late 2025, Tesla effectively discontinued taking new orders for the Model S and X in Europe due to low demand.

Take a step back

Before investors panic and have knee-jerk reactions such as saying Tesla is no longer an automaker, or being overly concerned it’s discontinuing a big chunk of its product list, it would be wise to take a quick glance at recent sales.

While Tesla doesn’t break out its Model S and X sales individually, it gives us plenty of insight through sales of its “other models,” which are combined results from the Model S, Model X, and Cybertruck. In 2025, deliveries of those models totaled 50,850 units, or just over 3% of Tesla’s total 1.6 million deliveries.

Today’s Change

(3.50%) $13.90

Current Price

$411.11

Key Data Points

Market Cap

$1.4T

Day’s Range

$397.75 – $414.55

52wk Range

$214.25 – $498.83

Volume

63M

Avg Vol

73M

Gross Margin

18.03%

What it all means

For investors, this officially should mark the fork in the road. It’s absolutely time to take a look at when and why you started your Tesla position, and whether it’s still the company or has become the company you first aligned with. Tesla is aiming to be far more than an electric vehicle maker, and by the end of this year, the company could be producing Optimus robots with a long-term goal of making a million units annually.

Uncertainty is risk, and Tesla’s future and business is arguably more uncertain in this moment than it has ever been, or at least since its early beginnings. There’s nothing wrong with that, and the upside is sky-high, but it’s also not an investment for everyone. It’s critical that investors understand this because Tesla is again shooting for the stars and putting its money where its mouth is. Now it’s for you to decide if this is a ride you want to take.