Friday, September 30, 2011


Yesterday we looked at NonFarm Corporate Business debt:

Graph #1: NonFarm Corporate Business Debt

Today, we look at other debt: Financial debt (blue), Government debt (red), and Household debt (green).

Graph #2: Financial, Government, and Household Debt

To be clear, "Government" debt here refers to Federal government debt and excludes internally-held government debt (because TCMDO excludes it).

First: None of these three debt series has flat spots at recessions since 1990. On the other hand, all three of them show a major change at the time of the 2008 recession.

In fact, the three debt trends, since the wilt began, look as though they are converging to a common point. That's just bizarre. But it might be interesting to look at, every six months or so.

In the meanwhile, a look at these three components of debt along with their exponential trend curves:

Financial debt is the fastest-growing, with the steepest exponential. But the actual numbers fall behind the calculated curve some years before the peak.

In yellow, household debt shows the second-fastest growth on this graph and, until the wilt began, the actual debt numbers kept up with the exponential trend.

In last place, debt of the Federal government. Government debt growth was significantly ahead of its exponential trend there for a while, but curved back down below the trend during the "macroeconomic miracle," then ran below-trend until the crisis.

No comments: