In the US, core of the global market economy and centre of the current storm, the aggregate debt of the financial sector jumped from 22 per cent of gross domestic product in 1981 to 117 per cent by the third quarter of 2008. In the UK, with its heavy reliance on financial activity, gross debt of the financial sector reached almost 250 per cent of GDP (see charts).
At the peak, America absorbed about 70 per cent of the rest of the world’s surplus savings.
Meanwhile, inside the US the ratio of household debt to GDP rose from 66 per cent in 1997 to 100 per cent a decade later.
Even bigger jumps in household indebtedness occurred in the UK.
in the US, overall debt reached an all-time peak of just under 350 per cent of GDP – 85 per cent of it private. This was up from just over 160 per cent in 1980.
“I’ve a feeling we’re not in Kansas any more,” said Dorothy after a tornado dropped her,
The world of the past three decades has gone.
is for us to seek to determine.
clipped from: www.ft.com