Tuesday , 19 September 2017


Debt Clocks of the U.S., U.K., Canada, Australia & the World

The budgets of most advanced economies,time excluding interest payments need 20 consecutive years of surpluses exceeding 2% of gross domestic product – starting now – just to bring the debt-to-GDP ratio back to its pre-crisis level.

[The following information is presented by  Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com and www.munKNEE.com and the FREE Market Intelligence Report newsletter (sample here – register here). This paragraph must be included in any article re-posting to avoid copyright infringement.]

According to the Bank for International Settlements, if only one of the following three conditions is met, the increased financial burden imposed by ageing populations and lower growth will make it unlikely that indebted economies will be able to grow out of their debt problem:

  1. government debt is more than 80% to 100% of GDP;
  2. non-financial corporate debt is more than 90%;
  3. private household debt is more than 85% of GDP.

The Boston Consulting Group (BCG) adds that if the overall debt load continues to grow faster than the economy, then large-scale debt restructuring becomes inevitable.

To prevent a vicious upward debt spiral from gaining momentum the authors urge policy makers to:

  •  act quickly and decisively
  • aim for an overall debt level well below 180% for the private and government sector based on the assumption that governments, nonfinancial corporations, and private households can each sustain a debt load of 60% of GDP, at an interest rate of 5% and a nominal economic growth rate of 3% per year. Lower interest rates and/or higher growth would help reduce the debt burden further.

Source: Wikipedia

To see an up-to-the-second visual of the debt picture of certain countries visit the links below:

1. World (by country): http://www.usdebtclock.org/world-debt-clock.html

2. U.S.A.: http://www.usdebtclock.org/

3. Canada: http://www.nationaldebtclocks.org/debtclock/Canada

4. U.K.: http://www.nationaldebtclocks.org/debtclock/unitedkingdom

5. Australia: http://www.nationaldebtclocks.org/debtclock/australia 

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One comment

  1. There’s something to be said about tackling your debt. You don’t have to pay it off all at once (who can?), but if you start to make a dent in it it becomes easier to tackle overall. There’s no reason to feel you can’t handle your debt because you can snowball the payments and feel accomplished.