The Debt Hangover - speech by Andy Haldane

In a speech in Liverpool this evening, Andrew Haldane - Executive Director for Financial Stability - discusses implications of the stocks of debt held by agents across the economy - the debt hangover as he calls it - and the current opportunities available to pay them down, before describing two reforms that might curb the accumulation of debt in the future.
Published on 27 January 2010

Andrew Haldane begins by emphasising that the financial system has been significantly more stable over the past six months, but some of the root causes of the crisis remain. One of those is an accumulation of debt. He says that to different degrees a debt hangover is affecting households, financial and non-financial companies and sovereign states around the world, but is perhaps greatest in the financial system. He notes that to date the servicing costs of these debts have been cushioned by policymakers' actions, but public sector support can only ever offer temporary relief - they are not a long-run cure.

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