MGI: Debt and (not much) deleveraging Post author By Philip Lane Post date February 5, 2015 The latest report on global debt levels and deleveraging from McKinsey Global Institute: here. Categories In Uncategorized 3 Comments on MGI: Debt and (not much) deleveraging ← Pawn to King Four → GDP-indexed bonds; ECB and Greece 3 replies on “MGI: Debt and (not much) deleveraging” Yeah, saw that chart earlier. Either the Eurozone is essentially federalised, with the ECB standing behind all sovereign debt a la the BOE, BOJ, Fed etc etc … or we are defaulting in time. The business cycle turns down, our trade surplus drops, and the private sector has no ability to run the deficits required and the Government is towing the Bundesbank line. Simple sectoral balances. Debt has been the main driver of growth since the 70s. Debt needs growth to be repaid. Without fresh debt where does the growth come from? and how will the debt be repaid? Anyone who thinks US rates are going to rise needs a holiday, I think This issue is actually more important for the system than greece because it drives the dysfunction in Greece and everywhere else. Comments are closed.