Still not convinced? ok lets take that chart back a bit further. Also from Keen's website.
He refers to this graph in this presentation
From: http://www.youtube.com/watch?v=12kf1aW8Biw
I know that this is a long clip so I will summarise for you. The 2 great depressions of the last 150 years in Australia, (1890s and 1930s) both occurred when there were huge spikes in debt to GDP ratios. The scariest thing is that the level of debt this time around is far far higher than either of the previous 2 depressions. We need to learn from history, and Steven Keen's prediction of a 40% drop in house prices isn't simply being plucked out of the air, it is grounded in economic research and an understanding of the impact that such debt levels eventually has. The amount of deleveraging to take place from where we are today is incredible.
He refers to this graph in this presentation
From: http://www.youtube.com/watch?v=12kf1aW8Biw
I know that this is a long clip so I will summarise for you. The 2 great depressions of the last 150 years in Australia, (1890s and 1930s) both occurred when there were huge spikes in debt to GDP ratios. The scariest thing is that the level of debt this time around is far far higher than either of the previous 2 depressions. We need to learn from history, and Steven Keen's prediction of a 40% drop in house prices isn't simply being plucked out of the air, it is grounded in economic research and an understanding of the impact that such debt levels eventually has. The amount of deleveraging to take place from where we are today is incredible.
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