May 13, 2012

World Debt and GDP - Unsustainable

This is the chart I have been looking for.  Sorry, but the axis labels are not part of the graphic file. I have described them below. Thanks to Hayman Capital Management, LLC and Kyle Bass, via my dentist, for the lead to finally find it. Here is a comparison of the world's total  debt to GDP .

The dire conclusion is that the world's debt has grown at an 11% annual rate in these 9 years from $80 trillion to $220 trillion while the total world's GDP has grown only at a rate of ~4%. This is unsustainable and Bass' conclusion (in late 2011) is that hard defaults are imminent. See the full report and analysis here.



Blue = Public Debt Securities
Red = Private Debt Securities
Green = Bank Assets
Purple Line = Debt/GDP
The left axis is Total Global Debt in $Trillions from 0 at the bottom to $220 Trillion at the top ordinate. The columns are the years 2002 to 2010. The right axis is the Global Debt/GDP Ratio with the bottom axis at 240% to the top at 350%

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