Tump, debt build up will make coronavirus worse for global economy - Business Insider

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Opinion | The world's massive debt pile is making a coronavirus shock especially especially dangerous right now. By lopezlinette.

, so it's clear his interest has never been in solving problems like the one coronavirus poses — he just wants everything toThat's about $1.5 trillion more than we were holding the last time household debt peaked in 2008. The biggest chunk of this debt is held in mortgages, then student loans, then auto loans followed by credit cards.

That means that if a significant economic slowdown does come, and people are forced to work less or not at all, they'll have trouble paying down the debt they owe. We already know that coronavirus is causing massive supply chain disruptions. Manufacturing jobs, especially, depend on factories having every part they need to build what they build. Those parts come from all over the world, especially China. And in China, especially hard hit provinces like Guangdong and Hubei.

that could mean the difference between making and missing debt payments. Enough of this kind of household financial strain could slow the entire economy, especially since consumer spending is its brightest spot right now. "The American consumer really is the firewall between an expanding economy and a recession," Mark Zandi said, chief economist at Moody's AnalyticsCorporate America has the same problem. In its Financial Stability Report last May the New York Fed noted that "growth in business debt has outpaced GDP for the past 10 years, with the most rapid growth in debt over recent years concentrated among the riskiest firms.

To be clear, there are a wide range of opinions out there about what coronavirus' impact will be. While the market basically ignored it until this week, there are some economists — even

 

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lopezlinette

lopezlinette It would be so much easier to take you seriously if you weren't so committed to your hatred of the POTUS, Ms. Lopez.

lopezlinette Ya think?

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