5 charts that show how rising household debt could prompt another financial crisis

A new report by Oxford Economics analyses rising levels of household debt, using International Monetary Fund research.In five countries debt is rising at "exceptionally fast rates," and in three debt as a share of GDP is growing faster than prior to the financial crisis. High debt levels threaten financial stabilitybut two factors mitigate the risk. Rising levels of household debt around the world pose possible threats to growth and global financial stability, according to a new report by Oxford Economics.In five counties in particular, it says, household debt is growing "at exceptionally fast rates from already high debt stocks." In three, it says, debt as a share of GDP is growing faster than it did in the lead up to the 2008 financial crisis, and there is a risk lenders will begin to tap into subprime lenders.While this raises the risk of another global financial crisis, it says, two factors are at work that mitigate the risk, which were not in play a decade ago. As such, the report says it is "more sanguine" about medium- and long-term risks than the International Monetary Fund, on whose Global Financial Stability report the analysis is based.Keep scrolling for the research in five charts:The scope of debt: Household debt has increased in many middling advanced economies, although has declined in systemic countries like the US.Meanwhile, household debt has increased for most emerging economies, but the average level continues to be significantly lower than in advanced countries.Household debt has been growing quickly in advanced markets that did not bear the brunt of the 2008 financial crisis, but has declined in those that suffered the most between 2008-2011.See the rest of the story at Business Insider
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