The UK and US economies may be on the mend at last, but that’s not the pattern
elsewhere. On a global level, growth is being steadily drowned under a
rising tide of debt, threatening renewed financial crisis, a continued
squeeze to living standards, and eventual mass default.
I exaggerate only a little in depicting this apocalyptic view of the future as
the conclusion of the latest “Geneva Report”, an annual assessment informed
by a top drawer conference of leading decision makers and economic thinkers
of the big challenges facing the global economy.
Aptly titled “Deleveraging? What Deleveraging?”, the report points out that,
far from paying down debt since the financial crisis of 2008/9, the world
economy as a whole has in fact geared up even further. The raw numbers make
explosive reading.
Contrary to widely held assumptions, the world has not yet begun to de-lever.
In fact global debt-to-GDP – public and private non financial debt - is
still growing, breaking new highs by the month.
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