The world faces the largest financial crash ever. As it turned out every man on our planet has a debt surpassing $28,000.
According to a recent McKinsey Global Institute report, the total amount of debt on our planet has grown from $142 trillion at the end of 2007 to $199 trillion today.
All major economies today have higher levels of borrowing relative to GDP than they did in 2007. Global debt these years has grown by $57 trillion, raising the ratio of debt to GDP by 17 percentage point.
The US national debt was sitting at about 9 trillion dollars. Today, it has crossed the 18 trillion dollar mark.
Debt has actually grown the most in China. Total Chinese debt has quadrupled from 7 trillion dollars in 2007 to 28 trillion dollars today.
Three developments are potentially worrisome: half of all loans are linked, directly or indirectly, to China's overheated real-estate market; unregulated shadow banking accounts for nearly half of new lending; and the debt of many local governments is probably unsustainable. However, MGI calculates that China's government has the capacity to bail out the financial sector should a property-related debt crisis develop. The challenge will be to contain future debt increases and reduce the risks of such a crisis, without putting the brakes on economic growth.
"The current situation is much worse than in 2000 or 2007, and with interest rates near or at zero, the central banks have already used up their ammunition. Plus, the total indebtedness, especially the indebtedness of governments, is much higher than ever before," said Claus Vogt, a Berlin-based analyst.
"When the loss of confidence in the Fed, the ECB etc. begins, the stampede out of stocks and bonds will start. I think we are very close to this pivotal moment in financial history."
Read more on the subject here
Officials with the Indian Air Force believe that Russia's fifth-generation Su-57 fighter jet does not correspond to required characteristics and is inferior to the American F-35 and F-22
A nuclear-powered submarine of the British Navy surfaced in the ice of the Arctic for the first time in many years