This article needs to be updated.December 2016)(
|This article is part of a series on the|
| Budget and debt in the|
United States of America
The financial position of the United States includes assets of at least $269.6 trillion (1576% of GDP) and debts of $145.8 trillion (852% of GDP) to produce a net worth of at least $123.8 trillion (723% of GDP)as of Q1 2014.
In financial accounting, an asset is any resource owned by the business. Anything tangible or intangible that can be owned or controlled to produce value and that is held by a company to produce positive economic value is an asset. Simply stated, assets represent value of ownership that can be converted into cash. The balance sheet of a firm records the monetary value of the assets owned by that firm. It covers money and other valuables belonging to an individual or to a business.
Gross domestic products (GDP) is a monetary measure of the market value of all the final goods and services produced in a specific time period, often annually. GDP (nominal) per capita does not, however, reflect differences in the cost of living and the inflation rates of the countries; therefore using a basis of GDP per capita at purchasing power parity (PPP) is arguably more useful when comparing living standards between nations, while Nominal GDP is more useful comparing national economies on the international market.
Debt is when something, usually money, is owed by one party, the borrower or debtor, to a second party, the lender or creditor. Debt is a deferred payment, or series of payments, that is owed in the future, which is what differentiates it from an immediate purchase. The debt may be owed by sovereign state or country, local government, company, or an individual. Commercial debt is generally subject to contractual terms regarding the amount and timing of repayments of principal and interest. Loans, bonds, notes, and mortgages are all types of debt. The term can also be used metaphorically to cover moral obligations and other interactions not based on economic value. For example, in Western cultures, a person who has been helped by a second person is sometimes said to owe a "debt of gratitude" to the second person.
The U.S. increased the ratio of public and private debt from 152% GDP in 1980 to peak at 296% GDP in 2008, before falling to 279% GDP by Q2 2011. The 2009-2011 decline was due to foreclosures and increased rates of household saving. There were significant declines in debt to GDP in each sector except the government, which ran large deficits to offset deleveraging or debt reduction in other sectors.
At the micro-economic level, deleveraging refers to the reduction of the leverage ratio, or the percentage of debt in the balance sheet of a single economic entity, such as a household or a firm. It is the opposite of leveraging, which is the practice of borrowing money to acquire assets and multiply gains and losses.
As of 2009, there was $50.7 trillion of debt owed by US households, businesses, and governments, representing more than 3.5 times the annual gross domestic product of the United States.As of the first quarter of 2010, domestic financial assets totaled $131 trillion and domestic financial liabilities $106 trillion. Tangible assets in 2008 (such as real estate and equipment) for selected sectors totaled an additional $56.3 trillion.
The United States of America (USA), commonly known as the United States or simply America, is a country comprising 50 states, a federal district, five major self-governing territories, and various possessions. At 3.8 million square miles, it is the world's third or fourth largest country by total area and is slightly smaller than the entire continent of Europe. Most of the country is located in central North America between Canada and Mexico. With an estimated population of over 327 million people, the U.S. is the third most populous country. The capital is Washington, D.C., and the most populous city is New York City.
Real estate is "property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, buildings or housing in general. Also: the business of real estate; the profession of buying, selling, or renting land, buildings, or housing." It is a legal term used in jurisdictions whose legal system is derived from English common law, such as India, England, Wales, Northern Ireland, United States, Canada, Pakistan, Australia, and New Zealand.
Net worth is the sum of assets (both financial and tangible) minus liabilities for a given sector.Net worth is a valuable measure of creditworthiness and financial health since the calculation includes both financial obligations and the capacity to service those obligations.
Net worth is the value of all the non-financial and financial assets owned by an institutional unit or sector minus the value of all its outstanding liabilities. Since financial assets minus outstanding liabilities equal net financial assets, net worth can also be conveniently expressed as non-financial assets plus net financial assets. Net worth can apply to companies, individuals, governments or economic sectors such as the sector of financial corporations or to entire countries.
The net worth of the United States and its economic sectors has remained relatively consistent over time. The total net worth of the United States remained between 4.5 and 6 times GDP from 1960 until the 2000s, when it rose as high as 6.64 times GDP in 2006, principally due to an increase in the net worth of US households in the midst of the United States housing bubble. The net worth of the United States sharply declined to 5.2 times GDP by the end of 2008 due to declines in the values of US corporate equities and real estate in the wake of the subprime mortgage crisis and the global financial crisis. Between 2008 and 2009, the net worth of US households had recovered from a low of 3.55 times GDP to 3.75 times GDP, while nonfinancial business fell from 1.37 times GDP to 1.22 times GDP.
The United States housing bubble was a real estate bubble affecting over half of the U.S. states. Housing prices peaked in early 2006, started to decline in 2006 and 2007, and reached new lows in 2012. On December 30, 2008, the Case–Shiller home price index reported its largest price drop in its history. The credit crisis resulting from the bursting of the housing bubble is an important cause of the 2007–2009 recession in the United States.
The United States subprime mortgage crisis was a nationwide financial crisis, occurring between 2007 and 2010, that contributed to the U.S. recession of December 2007 – June 2009. It was triggered by a large decline in home prices after the collapse of a housing bubble, leading to mortgage delinquencies and foreclosures and the devaluation of housing-related securities. Declines in residential investment preceded the recession and were followed by reductions in household spending and then business investment. Spending reductions were more significant in areas with a combination of high household debt and larger housing price declines.
The net worth of American households and non-profits constitutes three-quarters of total United States net worth – in 2008, 355% of GDP. Since 1960, US households have consistently held this position, followed by nonfinancial business (137% of GDP in 2008) and state and local governments (50% of GDP in 2008). The financial sector has hovered around zero net worth since 1960, reflecting its leverage, while the federal government has fluctuated from a net worth of -7% of GDP in 1946, a high of 6% of GDP in 1974, to -32% of GDP in 2008.
In finance, leverage is any technique involving the use of debt rather than fresh equity in the purchase of an asset, with the expectation that the after-tax profit to equity holders from the transaction will exceed the borrowing cost, frequently by several multiples — hence the provenance of the word from the effect of a lever in physics, a simple machine which amplifies the application of a comparatively small input force into a correspondingly greater output force. Normally, the lender will set a limit on how much risk it is prepared to take and will set a limit on how much leverage it will permit, and would require the acquired asset to be provided as collateral security for the loan. For example, for a residential property the finance provider may lend up to, say, 80% of the property's market value, for a commercial property it may be 70%, while on shares it may lend up to, say, 60% or none at all on certain volatile shares.
|Sector:||Nonfinancial assets:||Financial assets:||Debts:||Net worth:|
|Household & Nonprofit:||28,329.6 (table B.100, line 2)||67,219 (table L.101, line 1)||13,784.8 (table L.101, line 25)||81,763.8 (table B.100, line 42)|
|Nonfinancial Corporate Business:||18,511.7 (table B.102, line 2)||16,427.9 (table L.102, line 1)||15,902.2 (table L.102, line 22)||19,094.4 (table B.102, line 33)|
|Nonfinancial Noncorporate Business:||10,974.6 (table B.103, line 2)||2,909.4 (table L.103, line 1)||5,100.7 (table L.103, line 15)||8,849.7 (table B.103, line 33)|
|Financial Business:||1,734.1 (table S.6.a, line 102)||82,057.2 (table L.107, line 1)||77,594.8 (table L.107, line 27)||6196.5|
|State & Local Governments:||9,716.3 (table S.8.a, line 75)||2,909.4 (table L.104, line 1)||5,100.7 (table L.104, line 18)||7525|
|Federal Government:||3,190.1 (table S.7.a, line 97)||1,727 (table L.105, line 1)||16,415.3 (table L.105, line 15)||-11,498.2|
|Foreign:||Not available||22,970.8 (table L.106, line 1)||11,045.1 (table L.106, line 25)||11,925.7|
|Total:||72,456.4||197,226.3 (table L.5, line 33)||145,882.7 (table L.5, line 19)||123,800|
|All figures from Q1 2014 except nonfinancial assets for financial and public sectors, which are from 2013|
Some figures are missing land and nonproduced nonfinancial assets.
|Asset (or Capital) Accounts |
(renamed for clarity)
per Federal Reserve Bank
& Receivables (10%)
Gain (or Loss)
|Households (& Non-Profits)||50.23||23.39||13.48||60.04||73.52||33.82%|
|Corporate (Big) Businesses||15.07||14.97||13.74||16.31||30.04||13.82%|
|Other (Small) Businesses||3.47||9.52||5.56||7.43||13.00||5.98%|
|Private Account Totals||152.99||49.45||106.16||96.28||202.44||93.12%|
|State & Local Government||2.52||8.90||3.72||7.71||11.42||5.25%|
|Public Account Totals||3.87||11.08||15.98||-1.02||14.95||6.68%|
|Gross Account Totals||156.86||60.53||122.14||95.26||217.14||100%|
|Less: 2010 Total Assets||-212.20|
|2011 Total Asset Gain||5.20||2.45%|
|Less: 2011 Inflation||-3.20%|
|2011 Real Asset Loss||-0.75%|
SOURCE: Federal Reserve Bank Z-1 Flow of Funds Statement, End of 2011 Accounts
(renamed & reclassified for clarity)
per Bureau of Economic Analysis
|Private Employee Wages||6.31||43.43%|
|Private Gross Profits||5.23||36.01%|
|Gross Private Income (or Value Added)||11.54||79.44%|
|Public Employee Wages||1.67||11.50%|
|Public Gross Profits||1.32||9.05%|
|Gross Public Income (or Taxes Added)||2.99||20.56%|
|Gross Domestic Income (or GDI)||14.53||100%|
SOURCE: U.S. Bureau of Economic Analysis, 2010 Accounts
(renamed for clarity)
per Bureau of Economic Analysis
|Consumer Service Purchases||6.85||47.25%|
|Consumer Product Purchases||2.29||15.76%|
|Consumer Durable Investments||1.08||7.44%|
|Individual Domestic Expense||10.22||70.46%|
|Business Hardware Investments||1.02||7.04%|
|Business Structure Investments||0.38||2.60%|
|Residential Structure Investments||0.34||2.35%|
|Business Domestic Expense||1.74||11.98%|
|Federal Defense Purchases/Investments||0.82||5.64%|
|Other Federal Purchases/Investments||0.41||2.80%|
|Government Domestic Expense||3.06||21.09%|
|Imported Product Purchases||-1.95||-13.43%|
|Imported Service Purchases||-0.41||-2.82%|
|Exported Product Purchases||1.28||8.82%|
|Exported Service Purchases||0.57||3.90%|
|Net Trade Loss (or Deficit)||-0.51||-3.53%|
|Gross Domestic Expense (or GDP)||14.50||99.81%|
|Statistical Discrepancy (Income > Expense)||0.03||0.19%|
|Equals: Gross Domestic Income (above)||14.53||100.00%|
SOURCE: U.S. Bureau of Economic Analysis, 2010 Accounts
|Financial sector||5612.9||807.7||167.4||8375.3 [A]||14963.3||104.9%|
|Households and non-profits||266.1||335.1||10480.1||2421.8 [B]||13503.1||94.7%|
|Nonfinancial business||4446.6||2835.7||3552.6||74.6 [C]||10909.6||76.5%|
|State and local||2369.8||13.7||2383.5||16.7%|
The Federal Reserve issues routine reports on the flows and levels of debt in the United States. As of the first quarter of 2010, the Federal Reserve estimated that total public and private debt owed by American households, businesses, and government totaled $50 trillion, or roughly $175,000 per American and 3.5 times GDP.
Interest payments on debt by US households, businesses, governments, and nonprofits totaled $3.29 trillion in 2008. The financial sector paid an additional $178.6 billion in interest on deposits.
In 1946, the total US debt-to-GDP ratio was 150%, with two-thirds of that held by the federal government. Since 1946, the federal government's debt-to-GDP ratio has since fallen by nearly half, to 54.8% of GDP in 2009. The debt-to-GDP ratio of the financial sector, by contrast, has increased from 1.35% in 1946 to 109.5% of GDP in 2009. The ratio for households has risen nearly as much, from 15.84% of GDP to 95.4% of GDP.
In April 2011, International Monetary Fund said that, "The US lacks a "credibility strategy" to stabilise its mounting public debt, posing a small but significant risk of a new global economic crisis.
In 1946, the US financial sector owed $3 billion of debt, or 1.35% of GDP. By 2009 this had increased to $15.6 trillion, or 109.5% of GDP.
Most debt owed by the US financial sector is in the form of federal government sponsored enterprise (GSE) issues and agency-backed securities.This refers to securities guaranteed and mediated by federal agencies and GSEs such as Ginnie Mae, Fannie Mae, and Freddie Mac, among others. This group also includes the mortgage pools that are used as collateral in collateralized mortgage obligations. The proportion of financial sector debt owed in the form of GSE and federally related mortgage pools has remained relatively constant – $863 million or 47% of total financial sector debt in 1946 was in such instruments; this has increased to 57% of financial sector debt in 2009, although this now represents over $8 trillion.
Bonds represent the next largest part of financial sector debt. In 1946, bonds represented 6% of financial sector debt, but by 1953 this proportion had risen to 24%. This remained relatively constant until the late 1970s; bonds fell to 14% of financial sector debt in 1981.This coincided with Federal Reserve chairman Paul Volcker's strategy of combating stagflation by raising the federal funds rate; as a result the prime rate peaked at 21.5%, making financing through credit markets prohibitively expensive. Bonds recovered in the 1980s, representing approximately 25% of financial sector debt throughout the 1990s; however, between 2000 and 2009, bonds issued by the financial sector had increased to 37% of financial sector debt, or $5.8 trillion.
Bonds and GSE/federal agency-backed issues represent all but 12% of financial sector debt in 2009.
In 1946, US households and non-profits owed $35 billion of debt or 15.8% of GDP. By 2009 this figure had risen to $13.6 trillion or 95.4% of GDP.Home mortgage debt in 1946 represented 66.5% of household debt; consumer credit represented another 24%. By 2009, home mortgage debt had risen to 76% of household debt and consumer credit had fallen to 18.22%. According to the McKinsey Global Institute, the 2008 financial crisis was caused by "unsustainable levels of household debt." The ratio of debt to household income rose by about one-third from 2000 to 2007. The US currently has the twelfth highest debt to GDP ratio among advanced economies.
In 1946, US nonfinancial businesses owed $63.9 billion of debt or 28.8% of GDP. By 2009 this figure had risen to $10.9 trillion or 76.4% of GDP.
In 1946, US state and local governments owed $12.7 billion of debt or 5.71% of GDP. By 2009 this figure had risen to $2.4 trillion or 16.5% of GDP.
In 2016, state and local governments owed $3 trillion and have another $5 trillion in unfunded liabilities.
State and local governments have significant financial assets, totaling $2.7 trillion in 2009. In 2009, these included $1.3 trillion in credit market debt (that is, debt owed by other sectors to state and local governments). These figures do not include state and local retirement funds.State and local retirement funds held $2.7 trillion in assets at the end of 2009.
In 1946, the federal government owed $251 billion of debt or 102.7% of GDP. By 2009 this figure had risen to $7.8 trillion, but the federal government's debt-to-GDP ratio had fallen to 54.75%.
The federal government held $1.4 trillion in assets at the end of 2009. This is more than double the assets held by the federal government in 2007 ($686 billion), mainly due to the acquisition of corporate equities, credit market debt, and cash. The federal government held $223 billion in corporate equity at the beginning of 2009; this had fallen to $67.4 billion at the end of that year.
These figures do not include federal government retirement funds. Federal government retirement funds held $1.3 trillion in assets at the end of 2009.
These figures also do not include debt that the federal government owes to federal funds and agencies such as the Social Security Trust Fund. It also does not include "unfunded liabilities" to entitlement programs such as Social Security and Medicare either as debt or accounting liabilities.According to official government projections, the Medicare is facing a $37 trillion unfunded liability over the next 75 years, and the Social Security is facing a $13 trillion unfunded liability over the same time frame.
Since 2010, the U.S. Treasury has been obtaining negative real interest rates on government debt.Such low rates, outpaced by the inflation rate, occur when the market believes that there are no alternatives with sufficiently low risk, or when popular institutional investments such as insurance companies, pensions, or bond, money market, and balanced mutual funds are required or choose to invest sufficiently large sums in Treasury securities to hedge against risk. Lawrence Summers, Matthew Yglesias and other economists state that at such low rates, government debt borrowing saves taxpayer money, and improves creditworthiness. In the late 1940s through the early 1970s, the US and UK both reduced their debt burden by about 30% to 40% of GDP per decade by taking advantage of negative real interest rates, but there is no guarantee that government debt rates will continue to stay so low. In January, 2012, the U.S. Treasury Borrowing Advisory Committee of the Securities Industry and Financial Markets Association unanimously recommended that government debt be allowed to auction even lower, at negative absolute interest rates.
|Total market value||4,002||27.4%||-3,886||-26.6%|
Figures of total debt typically do not include other financial obligations such as derivatives. Partly this is due to the complexities of quantifying derivatives – the United States Comptroller of the Currency reports derivative contracts in terms of notional value,net current credit exposure, and fair value, among others.
The number commonly used by the media is notional value, which is a base value used to determine the size of the cash flows exchanged in the contract.Fair value (or market value) is the value of the contract either on the open market or as it is appraised by accountants. Fair value can be positive or negative depending on the side of the contract the party is on. Credit exposure is defined as the net loss which holders of derivatives would suffer if their counterparties in those derivatives contracts defaulted.
The notional value of derivative contracts held by US financial institutions is $216.5 trillion, or more than 15 times US GDP.
The fair value of US-held derivatives contracts in the first quarter of 2010 was $4,002 billion (28.1% of GDP) for positions with positive values (known as "derivatives receivables"), and $3,886 for positions with negative values (27.3% of GDP).Interest rate derivatives form by far the largest part of US derivative contracts by all measures, accounting for $3,147 billion or 79% of derivatives receivables.
The measure preferred by the Office of the Comptroller is net current credit exposure (NCCE), which measures the risk to banks and the financial system in derivatives contracts. The net current credit exposure (NCCE) of American financial institutions to derivatives in the first quarter of 2010 to $359 billion or 2.5% of GDP, down from $800 billion at the end of 2008 in the wake of the global financial crisis, when it stood at 5.5% of GDP. The difference between the market value of US derivatives and the credit exposure to the financial system is due to netting – financial institutions tend to have many positions with their counterparties that have positive and negative values, resulting in a much smaller exposure than the sum of the market values of their derivative positions.Netting reduces the credit exposure of the US financial system to derivatives by more than 90%, as compared to 50.6% at the beginning of 1998.
Derivatives contracts are overwhelmingly held by large financial institutions. The five largest US banks hold 97% of derivatives by notional value; the top 25 hold nearly 100%.Banks currently hold collateral against their derivative exposures amounting to 67% of their net current credit exposure.
|A Includes corporate equity plus mutual fund shares|
Foreign holdings of US assets are concentrated in debt. Americans own more foreign equity and foreign direct investment than foreigners own in the United States, but foreigners hold nearly four times as much US debt as Americans hold in foreign debt.
15.2% of all US debt is owed to foreigners.Of the $7.9 trillion Americans owe to foreigners, $3.9 trillion is owed by the federal government. 48% of US treasury securities are held by foreigners. Foreigners hold $1.28 trillion in agency- and government sponsored enterprise-backed securities, and another $2.33 trillion in US corporate bonds.
Foreigners hold 24% of domestic corporate debtand 17% of domestic corporate equity.
Economist Martin Wolf explained in July 2012 that government fiscal balance is one of three major financial sectoral balances in the U.S. economy, the others being the foreign financial sector and the private financial sector. The sum of the surpluses or deficits across these three sectors must be zero by definition. In the U.S., a foreign financial surplus (or capital surplus) exists because capital is imported (net) to fund the trade deficit. Further, there is a private sector financial surplus due to household savings exceeding business investment. By definition, there must therefore exist a government budget deficit so all three net to zero. The government sector includes federal, state and local. For example, the government budget deficit in 2011 was approximately 10% GDP (8.6% GDP of which was federal), offsetting a capital surplus of 4% GDP and a private sector surplus of 6% GDP.
Wolf argued that the sudden shift in the private sector from deficit to surplus forced the government balance into deficit, writing: "The financial balance of the private sector shifted towards surplus by the almost unbelievable cumulative total of 11.2 per cent of gross domestic product between the third quarter of 2007 and the second quarter of 2009, which was when the financial deficit of US government (federal and state) reached its peak...No fiscal policy changes explain the collapse into massive fiscal deficit between 2007 and 2009, because there was none of any importance. The collapse is explained by the massive shift of the private sector from financial deficit into surplus or, in other words, from boom to bust."
Economist Paul Krugman also explained in December 2011 the causes of the sizable shift from private deficit to surplus: "This huge move into surplus reflects the end of the housing bubble, a sharp rise in household saving, and a slump in business investment due to lack of customers."
Derivatives, the great unknown with respect to its impact on the total US cumulative debt
The Federal Old-Age and Survivors Insurance Trust Fund and Federal Disability Insurance Trust Fund are trust funds that provide for payment of Social Security benefits administered by the United States Social Security Administration.
A government budget is a financial statement presenting the government's proposed revenues and spending for a financial year. The government budget balance, also alternatively referred to as general government balance, public budget balance, or public fiscal balance, is the overall difference between government revenues and spending. A positive balance is called a government budget surplus, and a negative balance is a government budget deficit. A budget is prepared for each level of government and takes into account public social security obligations.
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In economics, a country's current account is one of the two components of its balance of payments, the other being the capital account. The current account consists of the balance of trade, net primary income or factor income and net cash transfers, that have taken place over a given period of time. The current account balance is one of two major measures of a country's foreign trade. A current account surplus indicates that the value of a country's net foreign assets grew over the period in question, and a current account deficit indicates that it shrank. Both government and private payments are included in the calculation. It is called the current account because goods and services are generally consumed in the current period.
Government debt, also known as public interest, public debt, national debt and sovereign debt, contrasts to the annual government budget deficit, which is a flow variable that equals the difference between government receipts and spending in a single year. The debt is a stock variable, measured at a specific point in time, and it is the accumulation of all prior deficits.
Debt levels and flows are a measure of the levels of debt – how much debt is outstanding – and the flows of debt – how much the level of debt changes over time. This is basic macroeconomic data, and varies between countries. Debt is used to finance enterprises and business around the world. Within mainstream economics, levels and flows of public debt are a cause of concern, while levels and flows of private debt are not seen as being of central importance.
The United States federal budget comprises the spending and revenues of the U.S. federal government. The budget is the financial representation of the priorities of the government, reflecting historical debates and competing economic philosophies. The government primarily spends on healthcare, retirement, and defense programs. The non-partisan Congressional Budget Office provides extensive analysis of the budget and its economic effects. It has reported that large budget deficits over the next 30 years are projected to drive federal debt held by the public to unprecedented levels—from 78 percent of gross domestic product (GDP) in 2019 to 144 percent by 2049. The United States has the largest external debt in the world and the 14th largest government debt as % of GDP in the world.
The history of the United States public debt started with federal government debt incurred during the American Revolutionary War by the first U.S treasurer, Michael Hillegas, after its formation in 1789. The United States has continuously had a fluctuating public debt since then, except for about a year during 1835–1836. To allow comparisons over the years, public debt is often expressed as a ratio to gross domestic product (GDP). Historically, the United States public debt as a share of GDP has increased during wars and recessions, and subsequently declined. Eric hasman..
Flow of funds accounts are a system of interrelated balance sheets for a nation, calculated periodically. There are two types of balance sheets: those showing
Financialization is a term sometimes used to describe the development of financial capitalism during the period from 1980 to present, in which debt-to-equity ratios increased and financial services accounted for an increasing share of national income relative to other sectors.
This article provides background information regarding the subprime mortgage crisis. It discusses subprime lending, foreclosures, risk types, and mechanisms through which various entities involved were affected by the crisis.
Foreign trade of the United States comprises the international imports and exports of the United States, one of the world's most significant economic markets. The country is among the top three global importers and exporters.
The Australian government debt is the amount owed by the Australian federal government. The Australian Office of Financial Management, which is part of the Treasury Portfolio, is the agency which manages the government debt and does all the borrowing on behalf of the Australian government. Australian government borrowings are subject to limits and regulation by the Loan Council, unless the borrowing is for defence purposes or is a 'temporary' borrowing. Government debt and borrowings have national macroeconomic implications, and are also used as one of the tools available to the national government in the macroeconomic management of the national economy, enabling the government to create or dampen liquidity in financial markets, with flow on effects on the wider economy.
The Great Recession in the United States was a severe financial crisis combined with a deep recession. While the recession officially lasted from December 2007 to June 2009, it took many years for the economy to recover to pre-crisis levels of employment and output. This slow recovery was due in part to households and financial institutions paying off debts accumulated in the years preceding the crisis along with restrained government spending following initial stimulus efforts. It followed the bursting of the housing bubble, the housing market correction and subprime mortgage crisis.
The financial crisis of 2007–2008, also known as the global financial crisis and the 2008 financial crisis, was a severe worldwide economic crisis considered by many economists to have been the most serious financial crisis since the Great Depression of the 1930s, to which it is often compared.
The United Kingdom National Debt is the total quantity of money borrowed by the Government of the United Kingdom at any time through the issue of securities by the British Treasury and other government agencies.
The sectoral balances are a sectoral analysis framework for macroeconomic analysis of national economies developed by British economist Wynne Godley.
A balance sheet recession is a type of economic recession that occurs when high levels of private sector debt cause individuals or companies to collectively focus on saving by paying down debt rather than spending or investing, causing economic growth to slow or decline. The term is attributed to economist Richard Koo and is related to the debt deflation concept described by economist Irving Fisher. Recent examples include Japan's recession that began in 1990 and the U.S. recession of 2007-2009.
The national debt of Pakistan, or simply Pakistani debt, is the total debt, or unpaid borrowed funds, carried by the Government of Pakistan, which is measured as the face value of the currently outstanding treasury bills (T-bills) that have been issued by the federal government. The terms 'budget deficit' and 'national surplus' usually refer to the federal government budget balance from year to year, not the cumulative amount of debt. A deficit year increases the debt, while a surplus year decreases the debt as more money is received than spent.