Jump to content
House Price Crash Forum
MrFlibble

Top 6 Most Indebted Countries (And Why)

Recommended Posts

http://financialedge.investopedia.com/financial-edge/0810/Top-6-Most-Indebted-Countries-And-Why.aspx

The recent financial crisis and recession have been a worldwide occurrence. The events in the United States since 2008 have garnered most of the headlines because the U. S. has the world's largest economy and national debt, but the reality is that many countries in Europe are in worse financial shape and continue to deteriorate.

There are various ways to rank indebtedness, such as debt per capita and deficit or debt as a function of gross domestic product (GDP). This ranking is based on cumulative debt as a percentage of GDP and is limited to an analysis of the 25 largest economies. It is further limited to "external" debt, which is the portion of the national debt that is owed only to foreign creditors. The source for the debt and GDP amounts is the Central Intelligence Agency World Factbook most recent numbers from mid to late 2009.

1. Ireland - Debt/GDP: 997%

The days of Ireland enjoying one of the fastest growing economies in Europe are over, at least for now. The story is all too familiar, as easy credit fueled a housing bubble that burst and damaged consumer confidence.

After recording budget surpluses in the prior two years, the economy reversed course in 2009 and contracted 7%. This eroded tax revenues and sent the annual deficit to a record 14.3% of GDP. The European Union set a target for Ireland to reduce that figure to 3% by 2014, but the International Monetary Fund has indicated that the deadline will be missed. Moody's has subsequently lowered its bond rating. (Learn about credit rating agencies and how were they developed in A Brief History Of Credit Rating Agencies.)

2. Netherlands - Debt/GDP: 467%

The national debt in the Netherlands has reached record levels as a result of the world financial crisis and recession. Much of the added burden was caused by significant government support for the country's banking sector. The increase in debt per capita is second only to that experienced in Ireland.

The Netherlands joined the eurozone with a hard guilder a decade ago, but its current debt would likely disqualify it for membership.

3. United Kingdom - Debt/GDP: 409%

Investment bank Morgan Stanley fears that Great Britain could face a severe debt crisis in the near future if it continues down its current path. According to the bank's report, this is a case of not putting aside sufficient reserves when the economy was sound. During the peak of the boom, it still ran a budget deficit of 3% of GDP when other European countries were running surpluses exceeding 2%.

Like many other countries, Britain bought time during the financial crisis by implementing massive fiscal stimulus and forcing the public to fund losses in the private sector. Without the restoration of fiscal credibility, there is a significant danger of a government bond sell-off, pound weakness and a flight of capital. (The stimulus packages through the recession varied from country to country. Learn more in Global Bailout: Did The U.K. Do Enough?)

4. Switzerland - Debt/GDP: 273%

Generally regarded as having one of the world's most stable economies, Switzerland has taken its budget crisis seriously. When the national debt began to escalate in the last decade, the Swiss voted to approve a constitutional amendment forcing the government to balance expenses and revenue during each economic cycle. While annual deficits may still occur, this has instilled discipline in the process and lowered the country's borrowing costs as investors rushed to safety.

This so-called "debt brake" was implemented in response to increasing debt stemming from a slowdown in economic growth. Deficits climbed as spending rose for unemployment benefits and tax revenues declined. While government expenditures were cut across the board, rising revenues have not been sufficient to pay down the incurred debt.

5. Portugal - Debt/GDP: 228%

With last year's deficit coming in at 9.4% of GDP, the Portuguese government has instituted a growth and austerity program with the objective of reducing that number to 2.8% by 2013. These measures have sparked strikes in the public sector including postal and transportation services. Those events have been further propelled by unemployment above 10%, the worst in 40 years.

The root problem has been low productivity and virtually no economic growth in the past few years. Portugal ranks last in GDP growth among countries that adopted the euro as a common currency. Demand for goods and services has stalled, along with innovation and business momentum. In addition, Portugal's exports have been undercut by cheap labor in countries such as China. (For related reading, see The Economics Of Labor Mobility.)

6. Austria - Debt/GDP: 214%

The recession and government assistance to banks have contributed to the budget crisis in Austria. The finance minister has rejected the notion of higher taxes in favor of administrative reforms to cut spending. He has predicted that the annual deficit would grow from 3.5% to 4.7% of GDP between 2010 and 2012 before starting to decline. That peak would be the third-highest since 1976 when such data were first recorded.

Rising unemployment has resulted in increased expenditures for unemployment compensation and other government benefits. In addition to the reduced payrolls, tax reforms have driven down overall tax revenues.

The Bottom Line

While the U.S. and Canada have large economies, their respective debt-to-GDP ratios are 93% and 62%. The U.S. gets most of the attention because of the size of the numbers that comprise the ratio - $13.5 trillion debt (June 2009) and $14.4 trillion GDP (2009 estimate). (Learn more in 6 Things You Didn't Know About The U.S. Budget Deficit.)

By comparison, China and India have ratios of 7% and 20% respectively. Their economic growth rates have also exceeded the western nations over the past few years, thereby keeping their debt ratios relatively low. If the western nations don't implement policies to reduce their debts, they run the risk of jeopardizing future economic growth and prosperity.

Could be worse :unsure:

Share this post


Link to post
Share on other sites

One thing that (politically) stands out to me also, is in UK, Ireland, and Holland, all three have had mass immigration endlessly promoted as some kind of solution for all our economic problems, and all three are, according to this, the most FUBARed.

From where im standing it looks like we have a shortage of jobs, not labour.

Share this post


Link to post
Share on other sites

One thing that (politically) stands out to me also, is in UK, Ireland, and Holland, all three have had mass immigration endlessly promoted as some kind of solution for all our economic problems, and all three are, according to this, the most FUBARed.

From where im standing it looks like we have a shortage of jobs, not labour.

Clearly you are a racist, and racism is far worse than either murder or slavery.

What we have in Britain is a cost crisis. It is too expensive to live, work and run a business in the UK.

It has nothing to do with immigration at all, which definitely isn't a sneaky way to hide a massive trade deficit by making your foreign suppliers nominally British. Any suggestion like that is totally racist, and makes Harriet Harman cry.

Share this post


Link to post
Share on other sites

Clearly you are a racist, and racism is far worse than either murder or slavery.

What we have in Britain is a cost crisis. It is too expensive to live, work and run a business in the UK.

It has nothing to do with immigration at all, which definitely isn't a sneaky way to hide a massive trade deficit by making your foreign suppliers nominally British. Any suggestion like that is totally racist, and makes Harriet Harman cry.

I suspect the whole BTL market was encouraged to enable millions of foregners to gain easy accesss to accommodaition with no questions asked under the noses of the public. Without accommodation illegal and legal migration in such numbers would have been impossible without it being very obvious what was going on.

Share this post


Link to post
Share on other sites

I suspect the whole BTL market was encouraged to enable millions of foregners to gain easy accesss to accommodaition with no questions asked under the noses of the public. Without accommodation illegal and legal migration in such numbers would have been impossible without it being very obvious what was going on.

Not sure why BTL was encouraged, it runs so counter to Labour party values. I suspect massive corruption, since many MPs were into property speculation. I think the expenses scandal was a minor sideshow in comparison.

Immigration though was a beautiful nexus between the mindless multi-cult, identity politicking HR lunatics that make up the modern left, and the slave driving factory owning, minimum wage paying business types, that make up the modern right.

With both spurious economic justifications from the right, and spurious moral justifications from the left, it is difficult to argue against.

EDIT: You damn racist.

Edited by (Blizzard)

Share this post


Link to post
Share on other sites

Not sure why BTL was encouraged, it runs so counter to Labour party values. I suspect massive corruption, since many MPs were into property speculation. I think the expenses scandal was a minor sideshow in comparison.

What are these Labour party values? Are they all about the self interest of the unions, or is there something noble and just that I'm missing?

Share this post


Link to post
Share on other sites

What are these Labour party values? Are they all about the self interest of the unions, or is there something noble and just that I'm missing?

You know, all that party of the working class stuff. I'm not saying I believe it, only that they believe it.

Labour see themselves as the moral party that protects the weak and the poor. Like BTL millionaires and billionaire Russian gangsters.

Share this post


Link to post
Share on other sites

I think you are missing out on the fact that places like Switzerland, Holland, the UK and even Ireland hold large amounts of foreign assets, eg. Shell, Unilever, BP, HSBC etc

So basically it just shows they are small globalised trading nations whereas most americans dont have a passport or really need one

Share this post


Link to post
Share on other sites

I think you are missing out on the fact that places like Switzerland, Holland, the UK and even Ireland hold large amounts of foreign assets, eg. Shell, Unilever, BP, HSBC etc

So basically it just shows they are small globalised trading nations whereas most americans dont have a passport or really need one

Further to that point, what is to stop China et al buying every single company on the FTSE 100? what would be the consequences to the UK economy and the Governments tax take? Not to mention we would all basically be enslaved working for foreigners in our own land. This is more or less the case now, although not on such a grand scale, but look at all of our car manufacuturing industry, we build more cars in this country than ever before, just not for ourselves but for foreign companies. Most of the utility companies are now in foreign hands. Cadbury is a good example of a foreign company poaching a solid UK business...

Anyway, careful what you say about immigration otherwise you will have the anti-facist league (an oxymoron, if ever there was one) marching around to your house to beat the facism out of you (a bit like Nick Griffin when he was attacked outside the Houses of Parliament)...

Share this post


Link to post
Share on other sites

Not sure why BTL was encouraged, it runs so counter to Labour party values. I suspect massive corruption, since many MPs were into property speculation. I think the expenses scandal was a minor sideshow in comparison.

Immigration though was a beautiful nexus between the mindless multi-cult, identity politicking HR lunatics that make up the modern left, and the slave driving factory owning, minimum wage paying business types, that make up the modern right.

With both spurious economic justifications from the right, and spurious moral justifications from the left, it is difficult to argue against.

EDIT: You damn racist.

It was encouraged because the state has no way of providing homes for the entire population as social housing. To get someone else to so provide. Alas is no more and as the state can never step in, as BTL declines many will be forced to buy or go without a roof over their heads. The state is you and me.

Share this post


Link to post
Share on other sites
Guest Noodle

It was encouraged because the state has no way of providing homes for the entire population as social housing. To get someone else to so provide. Alas is no more and as the state can never step in, as BTL declines many will be forced to buy or go without a roof over their heads. The state is you and me.

That post is worthy of it's own topic.

Share this post


Link to post
Share on other sites

That post is worthy of it's own topic.

Well it is really. A lot on here see it different, but simply put, if a country can get its citizens to provide the majority of the housing then it wont have to throw up blocks of shithole flats like most countries do in order to house the populace. Except of course the homeless in the UK would want something a bit more in keeping with their aspirations. And now BTL aint there to provide it i aint got any idea who will . We are back to needing a huge social housing programme, and we aint got the money, and the rest of the population aint got the will.

Share this post


Link to post
Share on other sites
Guest Noodle

Well it is really. A lot on here see it different, but simply put, if a country can get its citizens to provide the majority of the housing then it wont have to throw up blocks of shithole flats like most countries do in order to house the populace. Except of course the homeless in the UK would want something a bit more in keeping with their aspirations. And now BTL aint there to provide it i aint got any idea who will . We are back to needing a huge social housing programme, and we aint got the money, and the rest of the population aint got the will.

Start the topic, it's an interesting one worthy of balanced debate.

Share this post


Link to post
Share on other sites

I thought Japan was about the same level as us?

Yeah but they only owe their own old people whereas i think this is external if i undertand it correctly. The differing ramifications of this are interesting

Share this post


Link to post
Share on other sites

I thought Japan was about the same level as us?

Yeah but they only owe their own old people whereas i think this is external if i undertand it correctly. The differing ramifications of this are interesting

Share this post


Link to post
Share on other sites

Im offering the Same Solution to the people of all Six countries.

A Serious Tax Revolt.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 138 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.