Daily chart

I put another chart.

http://www.usdebtclock.org/world-debt-clock.html

In the time series part of the chart (when clicking on a country), the labels seem to be mixed - for instance, for the UK, the Financial debt is at more that 200% of GDP in 2011 but the label in the time series says that this is the Corporate (Non Financial)debt.

It would be very interesting to see the same data before Euro was born and 5 years later. Were we all in a better shape? Is it really so important the level of debt as % of GDP?

It would have been intresting Greek, South African and Australian data!

After taking a look to what has happenned, and is yet happenning, specially in countries such as Spain, with a recent record of strong growth fueled by incoming credit, I wonder wether the currently accepted procedures for public accounting are not, at least, far too incomplete to make real sense in a globalized economic environment.

We use GDP levels and it's change rate to monitor the evolution of an economy, whilst paying a short attention to changes in debt - specially in private debt. But when the GDP of a country is boosted by huge amount of incoming borrowed money, which lenders are expecting to be, sometimes, somehow, paid back, we may be fatally overestimating the real capacities of this economy.

While international money flows are kept under a certain level it may not have a dramatic effect. But Spain, as an example, has been borrowing 10 to 12 % of its GDP every year for the past decade.

We may be needing some new figures in the tables and charts.

The category called "Financial" seems to be government. Categories seem switched around a time of this writing.

This chart, like many before, is a trove of information. Thank you.

I did on it a Borda's ranking.

For those unfamiliar with the term, most “ranking method mathematicians” consider it, despite being over 200 years old, the most reliable method apart from MOLP and applications of DEA. The latter two tools, far more sophisticated are too juvenile and too cumbersome for easy use.

The results are as follows: (From worst to best; the fewer points, the worse; alphabetical order when tied)

Britain.............10
Japan...............15
France..............16
Spain...............19
Italy...............24
S. Korea............24
Germany.............26
USA.................26
Canada..............27
China...............38
Brazil..............43
India...............46
Russia..............50

As could be expected, apart from a few rank swaps of no great importance, these ranks are close to those of your “overall” debt, which in, accordance to Borda's method, I did not take into consideration as it could partly repeat partly the other data.

Every time I show similar conclusions, a number of my previous fellow British taxpayers accuse me of trying to insult Britain.

I certainly will never insult Britain in any way.

All I'm doing is to alert an absent-minded pedestrian who's walking straight ahead into a lamp post and is looking sideways by shouting:

“Look out! You'll knock your head against that post!”.

Britain's government debt maturity is longer than most others. It can a be a blessing: gives you time for correction .

It can be a curse : you may feel there's nothing to worry about.

There is a lot to worry about.

If I may digress just a little. Given that this Daily Chart addresses a popular perception that seems to accept without question the curious proposition that widely divergent nations can be realistically compared, on whatever criteria we care to adopt, it was fascinating to me to witness the vitriolic 'snowstorm' that was unleashed here yesterday by the observation that Australia had, as usual, not been included in the statistical analysis. I, for one, have long been aware that "the (real?) World" is 'universally' understood as being located entirely in the northern hemisphere. Except by those who happen to live south of the Equator. And I think there are obvious historical reasons for this. What I find particularly disturbing, however, is that any reasonably educated person, who may actually be a fifth generation Australian and who would not dream of living anywhere else, can easily find himself, at a moment's notice, be it in Sydney or Oodnadatta, in a situation of being shouted down and told, in wildly extravagant terms, to "go back where you came from", if he so much as dares to suggest that anything in Australia is not quite what it could be, or perhaps should be. Now, I've been around a bit. Born in one place, raised elsewhere, and migrated far away and 'for good', more than once. Mono-cultural people tend to call this "interesting". And I suppose it would seem like that, if you have only ever spoken one language and always spent your holidays in the same places, where you always expect to eat "proper" food, follow the same sport, always vote for the same party and expect the kids to follow in your footsteps. It may be that, in your street, questions of colour, customs and manners never even come up. From what I have seen on my travels, I wonder if it is appropriate to suggest that this defensive vehemence, evinced by certain enthusiastic members of the commentariat above – be they antipodean themselves or no – may be symptomatic of a fundamental insecurity, a perceived need to constantly reassert that "my country is absolutely the best bloody country in the whole goddamn world, and I'll personally deal with anyone who says otherwise." This is so sad. It is so reminiscent of something more popularly associated with places like Texas, perhaps. During the nineteenth century. Surely, New Yorkers or Berliners or the denizens of Paris or Beijing would never bother to convince anyone else of the obvious superiority in every respect of their peculiar place on the map, would they? After all, to what extent can national debt levels, national reputations and national levels of prowess, in any field of endeavour, be said to be a matter of opinion, and to what extent do they actually have anything at all to do with verifiable facts?

"Wealth ebbs away" is not the problem; there never was an amount of "wealth" (or value) to cover the absurd levels of debt presently poated world wide. Because the debts, mostly products of financial manipulatons, have no where near the required collateral to cover the anount which is 10-12times the WORLD's GROSS product it earns the label of "fictitious capital", a teerm first couned by Karl Marx to catalogue the debts run up in his time by governments and landed gentry to cover wars and other results of living beyond one's means.

In the 19th century these amounts would amount to around ten percent of an individual countries production of REAL (entrepreneur led LABOUR)[surplus]value. These amounts were no problem in boom times, but when a periodic crisis appeared and the bill collectors cometh, various devices (not all ethical) were used to clean the slate for the next boom period.

Today though after almost one hundred years of Keynesian and other's ideas of eternal "growth" by any means the situation is much more precarious. Just to look at the $700-1000TRILLION Debt (growing exponentially) on a (stagnating)GROSS world product of $70TRILLION gives a common sense answer that something is radically WRONG!

This run-a-way debt crisis will only be solved for the present by a massive DEFAULT amounting to 90% or more of the total debt. The "haircut" must be a shaved head; that is if a scalping is to be avoided. This is only rough justice; if there had been real value to begin with equal to the amounts of the debts this problem would be non-existent. Can you imagine the reaction from your friendly personal banker if you went to borrow ten times the amount of your net (collateral) wealth?

Then in future, after the current melt-down, governance needs to be put on a sound financial footing.

Deficits for other than capital expenditures (public or private) are to be prohibited; any deficits must only be of the double entry type and provide for future incomes to pay for self: E.g. bridges>tolls, railways>fares, colleges>tuition. Such incomes if not fee for service but are public, must be produced by taxes on CURRENT activities.

Taxation of wealth/income rather than borrowing same is justified when:
1)The marginal utility of the amount increases when transferred to public hands; I.e. luxuries replaced by necessities.
2)Taxation does not crowd out funds needed for capital investment. (public or private); this is the affordable? test.

The West can thank unbridled Capitalism, unfettered laissez faire & infantile profligacy for the gruesome mess they created for themselves. It's pay-back time. We have years (decades?) of gut-wrenching austerity, pain & suffering to look forward to.

Welcome to the era of comeuppance..

This is a proof that debt to gdp ratio fail at explaining economics.

Richer country have Higher debt to gdp ratio. And vice versa.

Compare to the fitch or moody's rating. It's all mixed up side down.

I'm afraid this graph is highly misleading as long as one does not explain that it shows gross debt, adding up the debt of a country's households, firms and government. But of course a lot of the debt of governments and firms is typically held by households and therefore cancels out. Net debt is much smaller. Where even households are indebted, as in the US, the current account deficit makes up for the difference.
The graph also does not provide the comfort for US citizens that some readers seem to have read into it. First of all, declaring bankruptcy is easier for households in the US than in Europe; and banks are more aggressive in pursuing households who cannot pay their mortgage debt. So the foreclosures in the US, ie people being evicted from their homes and banks seizing the housing assets to recover parts of their loans, have the effect to reduce household debt. I am not sure that overindebted Brits envy similar households in the US for that.
Secondly, US firms finance their investments much more through the issuance of equity than through bank credit. Equities are not included in the debt figures shown because they give property rights, not just a claim, to those who finance a firm’s investment. If a firm does not do as well as expected, it will not default on a credit but the share prices simply go down and the holder of the equity gets poorer. Again, this is a much higher risk for US households than for hosueholds in Europe.

Following this non-saying chart, you should look at the fact alongside debts.
Debts for it self, to be non-saying.

All the crises is based on banks with a low capital-assets-ratio.
Throughout the world it was under 10%. And Hedgefonds and Private Equities were excluded from (bank's)regulations. So the latters were able to leverage (its business) to the sky with a minimum of liability. So you remember their equity is was and still is under 10%. To keep the liability at a minimum, high dividends were payed out.

And the 1% were bailed-out by the 99%. And the check is payed by the 99% whereas the assets of the 1% are being saved at the expenses of the 99%. Simple said: The 99% are and will pay for the saving of the assets of the super riches so that the super riches are able to be rich and earn even more money as they did before. That is a fine game.

So when we come back to debts, we should keep this in mind. A lot of the current debts of the nations are due the bail-outs of their so greedy banks without ANY liability of those who should be responsible for the risks that were taken.

And regulations is still not applied. And as long as we do not regulate the financial sector, we will find no solutions for the debts crises. For any solutions we should put pressure on the politics that the financial sector is finally participated in the cots of bail-outs e. g. with a financial transaction tax and furthermore strict regulations are made.

Now I'm convinced more than ever.

We need to elect Ron Paul in November.

As they say, if you are not rich, you are not elgible to borrow. The number did not reveal the whereabout of the richness in these countries. Many of the undebted countries live in shadow banking - that speak volume!

As an American I feel relieved to see these numbers. I don't know if my memory is failing me or what, by I thought I had seen worse numbers for America.

This shows how relatively fortunate we are compared to Europe at this moment. An ideal government (or Congress to be more precise) would have instantly taken advantage of our low interest rates and infused a >$500 stimulus into the economy, in other words, taking in the costs it would have had to undergo at anyway (fixing roads and schools should be done regardless of whether we intend to commit ourselves to Keynesian economics), yet taking advantage of the abundance of labor and credit in this depressed economy.

Very likely, and minus what may happen in Europe, we would have seen a robust recovery. Eventually, with a real GDP growth of %3 (our long time average) and an inflation of, say, 3%, we would witness a 6% annual decrease in our debt levels. But of course, there is a major political party that, to say the least, disagrees with this approach.

I thought United States had much higher debt/GDP, nearly 100%? Are the numbers wrong or am I reading them wrongly?

I realise by now that Australia is of scant importance to those at the Economist, but surely it could occasionally be included in various world comparisons?
It is a G20 nation, has 22,000,000 people and a near trillion dollar economy. You must be aware it outperforms most countries on most criteria on a per capita basis. Government debt as a percentage of GDP being just one of them.

Today almost every rich (and poor) countries have to make up the difference between their operating revenue and spending by issuing more debts. An economic collapse seems inevitable sooner or later unless the people are willing to forgo some of the election benefits that had been promised by populist politicians.

One person's debt is the other's receivable. High level of debts here means high level of wealth somewhere else.

Debt @ 3-4 times the income of a person's annual income may look like a problem. When taken as a whole, who in the end owns that debt?

One the one hand, someone borrows money for spending. One the other hand, that precise someone deposits money in a bank that lends money to finance the borrowing. In an web of lenders-borrowers like that, we need better metric to measure the problem and to understand it.

Say Russia: debt level doesn't suggest it is in good shape. It may just suggest that lenders do not believe borrowers that much to open the purse.

Say UK: high level of financial sector debt doesn't suggest they are near bankruptcy. It just suggests that: trust and credit are so high that banks are able to borrow from one another. When all are consolidated in an accounting way, the debt level suddenly comes close to zero in a synthetic bank (not necessarily big).

Economists, we need a NET DEBT position analysis. We just are not satisfied with one side of the coin analysis