Home » Blogs » a little night musing's blog

Debt and the Finance Sector

Thu, 07/23/2009 - 1:46pm — a little night ...

I've been wanting to write about the way the Finance sector came to dominate our economy, and what that means: a debt-driven economy. Barry Ritholz at The Big Picture has provided a graph that is certainly worth a thousand words:

Total Debt-to-GDP ratio versus Financial Profits

The chart compares the rise in Total Credit Market Debt (as a percentage of the GDP) to Finanacial Profits (as a percentage of the GDP). And - surprise! - they rise in tandem!

That's about all you need to know. The rest is commentary.

But you totally should read the paper linked at this previous post on TBP, entitled "The Jalopy Economy"

»

Comments

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.

1980... 1980... 1980...

By hipparchia on Thu, 07/23/2009 - 8:14pm

let's see... what happened in 1980? wait, don't tell me, it'll come to me....

i nominate this for best. graph. ever.

»

See this post and chart

By lambert on Thu, 07/23/2009 - 8:37pm

Same phenomenon. I didn't know anything about the finance sector when I wrote it (not that I know much know).

All those curves are about to get fluky.....

—

"First they ignore you, then they ridicule you, then they fight you, then you win." -- Mahatma Gandhi

»

that's my other favoritest chart in the whole world

By hipparchia on Thu, 07/23/2009 - 8:44pm

thanks for linking to it again.

»