Coleman Church

So it's grown over the last 30 years to incorporate

Sovereign debt, debt of countries, primarily issued in hard currency, dollars and euros, down to investment-grade corporates, government-owned debt like oil companies, let's say nationalized oil companies that would be called quasi-sovereigns.

down to corporate debt, all the way down to defaulted debt.

So it's all of credit, all credit products in a number of countries, it's ballooned.

But at the infancy, it was really a, it was a evolving asset class to kind of clean up the balance sheets and open access back to lending to these countries.

And instead of just being relied on major money center banks,

for loans that really sat on their balance sheet and weren't that liquid didn't trade much let's open it up to a global investor base create trade euro bonds put in your uh uh not necessarily putting your 401k but put in your pension funds and then hedge funds traded it and from there it evolved from dollar debt into the local currency debt became much more fashionable uh so investors can buy turkish lear denominated debt or

Kenyan shilling denominated debt, and then obviously derivatives.

You can buy Kenyan debt in Kenyan currency?

You can.

It's not that easy, but the harder it is to trade, the more the banks make money at trading it.

So certain countries are harder to access than others.

Yep.

You issue locally, issue local bills to local banks primarily, local bank treasuries.

Foreign investors can access that through...

typically plain vanilla kind of derivatives, and they'll issue dollar-denominated Euro bonds that are open to the world to trade in dollars.

I mean, I saw it, my first job...

And for about a year, I was an analyst on a trading desk.

And like six months in, they gave me a trading book, the Mexico book.

It was 1994.