The IMF warns that another global financial crisis looms as it shares the global debt is skyrocketing and economies getting affected.
The global debt levels have reached well above the time of 2008 crash. Christine Lagarde, IMF head shares that the total global debt has surged 60% in both private and public sectors reaching the all-time high at $182 trillion which is another concerning point.
IMF stated:
“The sequence of aftershocks and policy responses that followed the Lehman bankruptcy has led to a world economy in which the median general government debt-GDP ratio stands at 52%, up from 36% before the crisis; central bank balance sheets, particularly in advanced economies, are several multiples of the size they were before the crisis; and emerging market and developing economies now account for 60% of global GDP in purchasing-power-parity terms – which compares with 44% in the decade before the crisis – reflecting, in part, a weak recovery in advanced economies.”
Financial experts have already come out and spelled the upcoming Financial crisis in 2020. Now, the International Monetary Fund (IMF) is warning about another financial meltdown. The causes for concern raised by IMF include a dramatic rise in lending and failure to impose tough restrictions on asset managers handling trillion dollar funds and insurance companies.
Furthermore, this is all making the governments and companies of developing worlds more vulnerable to destabilization which according to Lagarde “should serve as a wake-up call.”
The annual economic outlook of IMF in a separate analysis warns of the “large challenges” that loom over economies to prevent the “second Great Depression”.
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