From the recent book «This Time is Different,» we know that countries with
high debt levels grow more slowly, and defaul more frequently.
Not exact matches
There's opportunity in emerging market
debt despite
growing concerns over
higher credit
levels and the impact of a strong dollar, the chief executive of Goldman Sachs Asset Management told CNBC on Tuesday.
Staley told CNBC that given the
high level of
debt across the world, in particular among emerging markets where dollar - denominated
debt has
grown dramatically, many economies could be at risk if there were sudden changes in financial conditions.
When
debt levels are low, reforms aimed at improving productivity, if they are correctly designed and implemented, can result in the
higher productivity and GDP growth that could, in principle, allow a country to «
grow» its way out of
debt.
When growth is most needed, when a country is suffering from excessively
high levels of
debt, it is hard to find many cases in which the aggressive implementation of reforms led to growth rates fast enough for the debtor to
grow its way out of
debt.
Chinese
debt levels are extremely
high and
growing too rapidly largely because the growth in Chinese investment is greater than the economy's ability to absorb it productively.
Credit is
growing more slowly than it has in the past but not because the financial system has become more efficient but simply because
debt levels have become too
high, causing regulators to force down the growth in credit without seriously improving the efficiency of the financial sector.
Beijing can keep growth
high enough that unemployment is held to acceptable
levels only as long as
debt can
grow fast enough both to
Stocks with a history of consistently
growing their dividends have historically tended to perform well and exhibit less volatility in a rising rate environment, while
high yielding dividends, often considered «bond - like proxies,» have tended to be more vulnerable (due to their
high debt levels) and have historically followed bond performance when rates rise.
«Households with relatively
high incomes, couples with children, and people living in
growing regions tend to cause overall
debt levels to rise,» says Roger Sauvé, a demographer at People Patterns Consulting.
At a
high -
level, I see QCOM as a conservatively capitalized (
Debt / Equity = 36 %), free cash flow generating (FCF = ~ $ 5B 12 - months YTD), financially stable company (A + / Stable, A1 / Stable), who recently
grew their dividend by over 10 %.
Kids are
grown and gone or at least close to leaving the nest, your retirement account balances are likely as
high as they've ever been, and your
debt levels are as low as they've ever been.
This law
grew out of concern from the Department of Defense and base commanders that troops were being trapped in
high levels of payday loan
debt.
If this all happens, private investment jumps back to historical
levels or
higher, GDP can
grow at more than 2 % real / 4 % nominal as credit drives
higher growth, unemployment will come down, incomes go up as the pie increases and we start
growing out of our
debt problem.
1) Start saving early by setting realistic goals 2) Ensure the asset allocation in your portfolio remains in sync with your
level of risk aversion and overall investment objectives 3) Keep costs and taxes to a minimum by avoiding most
high turnover actively managed mutual funds and opting for tax - deferred savings whenever possible (not only do their investments
grow tax - sheltered but for most people their MTR at retirement would be lower than it is during their working years) 4) Balance your portfolio at least annually (some individuals may choose to do so semi-annually) 5) Hammer away at your
debt first — for example, when it comes to contributing to an RRSP or TFSA vs. paying down your mortgage, ideally you should do both.
Just because the stock market as a whole is overvalued and
high debt levels will make growth difficult and surprises more likely to be negative than positive, it doesn't mean that there aren't plenty of stocks that are undervalued and where intrinsic value is, in fact,
growing.
The
growing burden of student loan
debt: Young households are repaying an increasing
level of student loan
debt that makes it extremely difficult to save for a down payment, qualify for a mortgage and afford a mortgage payment, especially in areas with
high rents and home prices.