Posted on 09/12/2018 9:05:07 AM PDT by SeekAndFind
Ten years have passed since the 2008 subprime mortgage crisis, the worst financial panic since the Great Depression. Now it seems that some of the lessons learned back then are being forgotten. Growing debt burdens in emerging markets are igniting new fears of a crisis that could shake economies everywhere.
This time, the debt is not mortgages or deficit spending. The new crisis involves corporate debt and bonds.
What is setting off alarms is the recent collapse of the Turkish lira, which has lost more than forty percent of its value. Turkish banks and companies borrowed heavily over the past few years to finance infrastructure projects and even a mammoth cruise ship terminal. The lira's collapse makes it hard to repay loans or bonds made in dollars and euros.
Turkey is not alone in its dollar- and euro-delineated debt burden. Similar loans and corporate bond issues can be found in Brazil, South Africa, Argentina, Russia, and other nations. They have taken advantage of cheap money to bolster their national economies and build infrastructure. Investors have likewise shifted their money to these markets, ignoring risks and creating a massive bubble.
As a result of such policies, the McKinsey Global Institute reports that total world debt load is an incredible $169 trillion as compared to $97 trillion in 2007. This burden amounts to nearly two and a half times the size of the total global economy.
(Excerpt) Read more at americanthinker.com ...
Seems fungible — I imagine a lot of bonds are sold to individual bond-holders so that the corporation can get some cash to pay off the debt owed to a bank or consortium.
So ... different flavors, but also pretty muddy.
Sorry, I was sick the day they taught us that in school.
Regards,
How can the world be $169 trillion in debt? To whom do we owe it? Mars?
Of course people won’t learn. There are always those who heed the siren call of free stuff from the government, and there will always be politicians willing to hand it out.
Is it something I should be worried about?
Seriously. This number is meaningless.
$169 trillion is an incomprehensible number. On a related note, if you laid out 169 trillion $1 bills end to end, they'd stretch nearly 16.4 billion miles or almost to Pluto and back twice each way. Stacked on top of each other, they'd reach nearly 11.5 million miles high. This stack would weigh 186 million tons.
Obozenomics at it its finest. Just spend your self out of debt
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