Category: Think Tank

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One Response to “Total Credit as an Early Warning Indicator For Systemic Banking Crises”

  1. Frilton Miedman says:

    This paper is meaningful.

    I find it a little disturbing that the most common reference to current household debt is the cost to service debt, not the amount of debt vs income, or in this case, household debt to GDP.

    Even more disturbing was the GOP obsession with government debt, completely ignoring household debt altogether, thanks largely to Reinhart-Rogoff”s now infamous error.

    As rates increase, the cost to service household debt will also increase, the most important thing to look at is actual debt levels relative ti income (or GDP in this case), then consider fiscal policy (“it could happen” as Judy Tenuta once said) or Fed policy.