Total Credit Market Debt

Since 2008 we have started a new era. We entered the period of deleveraging. For more than half a decade we had an exponential growth system in credit, but we have ended this period. I will show you by analyzing "Total Credit Market Debt".

Total Credit Market Debt today, is at an astonishingly $55.3 trillion dollars.

Chart 1: Total Credit Market Debt Owed

And it is 350% of GDP.

Chart 2: Total Credit Market Debt as a Percentage of GDP

The total credit market debt = federal/state/local government debt + federal debt to trust funds + business debt + household debt + domestic financial sector debt.

This total credit market debt can be divided by federal debt and private debt.

1) Federal debt: $16.7 trillion.

Chart 3: Federal Debt: Total Public Debt

Federal debt is at 100% of GDP.

Chart 4: Federal Debt: Total Public Debt as a % of GDP

2) Private debt: $40 trillion.

Chart 5: Private Debt

Private debt is at 245% of GDP.

Chart 6: Private Debt as a percentage of GDP

As you can see, since 2008, the private sector has been deleveraging (Chart 6) and the Federal Reserve has been preventing this to happen (Chart 4).

But overall, the Federal Reserve hasn't printed enough money to keep debt going up exponentially (Chart 1).

So what happens when debt doesn't grow exponentially? You will get an economic collapse as Chris Martenson explains here.

To read the analysis: go here.