The great financial crisis was a product of excessive debt.
is the world safer today? Not exactly. Debt has risen
sharply in many countries over the past five years.
Ireland and Portugal stand out, not surprisingly, but the
debt story isn't just a Western one. China's debt rose more
than the U.S.'s between 2007 and 2012; no wonder many analysts
fret about the legacy of the country's 2009 stimulus program.
Private nonfinancial sector debt is approaching 150 percent of
GDP in the U.S. and emerging Asia the former by falling,
the latter by rising.
For the 18 countries included in the graphic above, debt has
increased by $33 trillion, or roughly 20 percent of GDP,
over the past five years. U.S. households have managed to
reduce debt, but by less than the average 40-percentage-point
drop seen after previous financial crises, according to a Bank
for International Settlements study.
Still, debt doesn't tell the whole story. India, Indonesia
and Turkey compare favorably on debt, but they have been hit
hard by the recent emerging-markets sell-off because of big
current-account deficits and concerns about broad economic