Capital Markets Autumn 2020

IV

Degrees of Debt The Economy

• Credit to U.S. households and non-financial corporations is over $33 trillion and the highest relative to GDP since 2011

• However, the debt service ratio, or share of income used for interest payments and amortizations, is relatively low

I

II

…But The U.S. Debt Service Burden Is Not

U.S. Debt Levels Are High…

20%

35

III

30

18%

25

Deficit Spending 16%

IV

20

15

14%

10

V

12%

5 U.S. Debt Trillions ($) Households & Corporations

U.S. Debt Service Ratio Households & Corporations

10%

0

VI

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

Source: Bank for International Settlements, September 2020. Debt Service Ratio is the share of income used for interest payments and amortizations in the non-financial private sector.

22