Here, from Peter Levring, is a discussion of high private household debt in Sweden and Norway and Denmark, along with some remarks by Paul Krugman. Here is an excerpt from Levring:
In Denmark, consumers owe their creditors 321 percent of disposable incomes, a world record that the Paris-based OECD said in November demands a policy response. In Sweden, debt by that measure is close to 180 percent, a level the government and central bank say can’t be allowed to rise. Norway’s central bank has struggled to find a policy mix that addresses its 200 percent private debt burden.
This chart from Nomura shows that Singapore’s loan growth has far outpaced its nominal GDP growth in recent years, making for the worst credit-GDP growth gap in Asia…
The optimistic stance of course is to focus on Singapore’s net asset position, quality governance, and its new and enhanced role in an “Average is Over” world. The same can be said for the Nordics as well.
China seems more like 2015 at this point, if that. And the Russian bailout bought some time for Ukraine.
Or, from Alen Mattich, Canada may be the next victim:
Canadian house prices are very clearly bubbly. By one estimate Canada’s house price to rent ratio–an important metric–is the furthest from historic trends than any country in the world right now. Various estimates have Canadian house prices at between a third and two-thirds over-valued.
I am myself inclined to think Thailand and Turkey are most vulnerable over say the next year, maybe Greece too, in part because of the accompanying political dysfunctions in each case. And is India’s recovery already over? Indonesia still has troubles ahead.
One key question is the relative worry weights you assign to private debt vs. bad institutions.
What about the rest of the world? The eurozone is seeing ongoing credit contraction and perhaps deflation too. Japan just announced a surprisingly large and apparently persistent current account deficit. And the United States? Things look pretty good, but in fact by the standards of historical timing we are soon due for another recession.
I’ll put my money on Turkey.