In a new report, Citi Research analyst Matt King looked at exploding global credit levels, why weakness on emerging markets is having such a large impact on equity markets and exactly where the world stands at this point. According to King, the deleveraging process could potentially be a painful one for global economies.
Growth/Debt Disconnect
Since the Financial Crisis in 2008, global economic growth has been lackluster. Growth levels in the United States, Europe and emerging markets have failed to approach pre-crisis levels. However, global credit levels have never been higher.
The global credit level is currently approaching $9 trillion, despite the fact that global GDP growth levels are not back to pre-crisis highs.
Where Is The Credit Being Created?
King explained…
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