The Mother of All Debt Crysies

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In the 1970s, public debt as a share of GDP was less than 100% of GDP. By 1999 that figure had risen to 350%. Now it is 420% of GDP in China and rising. But while debt ratio were high, debt servicing ratios were low. So even institutions that were effectively insolvent and bankrupt could survive. And now we're starting to see how this increase in debt servicing ratio may lead to whoever severe recession is likely in the next year.

Co-host Michael Chui talks with Nouriel Roubini. Roubini is professor emeritus of economics at the Stern School of Business at New York University, and CEO of Roubini Macro Associates, a global macroeconomics consultancy. He covers topics including the following:

The “mother of all” debt crises and what to do about it
Likely future trends in the global balance sheet—the world’s economic health and wealth
The trajectory of globalization
Which “megathreat” worries him most

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