The Man Who Got Britain Through The Recession Now Says We're 'Very Exposed' To A New Debt Crisis

"Business Insider: How exposed are we to another financial crisis? 

CEPR Geneva Report

Adair Turner: I think we’re still very exposed. Broadly speaking, what has happened since the crisis is that we have shifted leverage around the world but we haven’t gotten rid of it. This is the great conundrum to which we don’t yet have an answer.

In the UK and Spain and in Ireland and most dramatically in the US, there has been some deleveraging. But there has been a more than offsetting increase in public sector debt. So for every percentage point decrease in private sector debt as a percentage of GDP, there’s been a more than percentage point increase in public debt. Total leverage across the global economy has gone up.

We still don’t seem to know how to run our economies without credit growing somewhere faster than GDP, but that produces an eventual crisis..."

at http://www.businessinsider.com/adair-turner-talks-about-uk-household-debt-2014-10#ixzz3I2QHb3Lg