The Problems of Global Debt since 2008

Ćh Global Debt $4 IN THE AFTERMATH OF THE FINANCIAL CRISIS ($) Households borrow more Global debt has soared In many countries, debt to income ratios have continued to Since 2007, global debt has risen by $57 trillion, with government debt increasing sharply grow. China's debt is rising China's total debt has guadrupled, rising from $7 trillion to $28 trillion between 2007 and 2014. Government & household debt Government debt in advanced economies increased to $19 trillion between 2007 and 2014. Debt to GDP ratios are expected to rise further over the next five years in many of the world's major advanced economies. Rising government debt has been a leading cause of increased global debt. Household debt continues to grow and household deleveraging is too rare. The risk of China's debt China's debt has reached 282% of GDP, with $20.8 trillion of new debt added to the Chinese economy since 2008. China's debt has reached 282% of GDP, with $20.8 trillion of new debt added to the Chinese economy since 2008. Economists worry that an overextended property sector and unsustainable government finance could result in a wave of debt defaults. The challenge of living without debt It is vital that advanced economies learn to live with debt safely. In the following decades, the challenge is to monitor and manage debt to avoid destructive boom and bust cycles. £ Countries need a broader range of solutions to rid themselves of sovereign debt, and cannot do this based on austerity and economic growth alone. Promote varied sourced of financing Developing economies require significant funding for infrastructure, housing and industry. Future economic plans wil| have to focus on widening access to financial institutions, safer modes of lending and increased protection for borrowers. Sources: http://www.mckinsey.com/insights/economic_studies/debt_and_n of_much_deleveraging Finance 27