The International Monetary Fund devotes two chapters of its latest Global Financial Stability Report to the issue of household debt and points out:
- High household debt levels deepen and prolong economic recessions.
- US household debt is back at pre-Great recession levels hitting $12.84 trillion in the second quarter of 2017. The report offers this flowchart of the loops between debt, cash flow, demand and the economic cycle.
Pretty common-sense stuff. Yet, widely ignored by the monetary policy of central banks everywhere.
