Debt Levels Relative to GDP of PIIGS and Some Other Major Countries

Debt to GDP of PIIGS plus Major Countries

For some perspective on the European sovereign debt crisis, this chart illustrates the forecasted 2012 debt to GDP ratio for each of the PIIGS (red bars) plus a handful of today's major economies (blue bars).
120625 Chart of the Day - Debt Levels Relative to GDP 
While the PIIGS are currently enduring relatively high debt loads, it is noteworthy how some of the relatively safe nations/bond markets (e.g. United State and Germany) are not far behind.
These relatively high debt loads are of concern as they could lead to higher taxes sometime in the future and can risk fiscal crises if bond holders sense an increasing risk of default.
The current crisis in Europe provides a clear example of the bond market's reaction (i.e. higher bond yields) to increased default fears.
This leads to a very interesting case study that is Japan. With a debt to GDP ratio of over 200%, the Japanese 10-year bond yield is a relatively low 0.83%. Why? At the moment, the bond market feels that the Japanese have the ability to repay their debts — in part due to Japan's perceived ability to raise taxes. To that end, Japanese Prime Minister Yoshiko Noda just won opposition support for the doubling of the nation's sales tax to 10% by 2015.
So it's not just the amount of debt but also convincing your banker that you are good for it.
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  1. Debt is really becoming a global problem. This is true that the PIIGS are now enduring relatively very high debt problems. This high debt can be very harmful for PIIGS, as PIIGS is a higher tax payer as well.

  2. I really would like to say thanks to you for this char and data with us. This chart is really very helpful to understand the debt levels relative to the GDP of PIIGS and also with some more countries. This chart shows all the shows the debt level by countries.

  3. The load of debt is being increasing day-by-day and is now the major issues amongst the all. Every country is facing the problem of debt that hindering the international markets. The investors are pulling back their hands from investing as there doesn’t seem to be any progress.

  4. Well all the main countries are on the PIIGS chart having high debt relative to GDP. Japan is the only one Asian country to be outstanding in debt rest is still doing quite well. Still no one knows what the debt is going to cause if it still going to move on the same way.

  5. Today the abbreviation as well as meaning of GDP in itself has changed, firstly it was known as Gross Domestic Product and now it’s simply changed its abbreviation to Gross Debt Product. And above that what’s fascinating about it, Gross Domestic Product is stagnant from years and Gross Debt Product enchanting increasing on day-by-day. Now if anyone talks about GDP it’s all what debt being discussed.

  6. Today the whole scenario for debt has been changed and new patterns for managing finances are being applied. Now one has to go along the world making their future secure and debt free. Well I only know one thing to defeat debt and that is managing finance smartly and working accordingly with the planned budget.

  7. Surely debt is now one of the biggest issues and a bubble bursting topic which has to be taken care off as immediately as it can. All the major countries are really in a problematic condition with lots of debt and still increasing with the loads. Some crucial measures have to be taken to overcome debt or else it would be quite difficult to survive.

  8. Everyone has a dream to be financially strong and have a peaceful life but if we look around we would find many countries and states are still quite backward because lack of capital. Majority of residence are moving out in search of job, education, living and much more. Well results are same everywhere just because of heavy debts, the governments are also not able to impose any laws or measure to the big destruction and falling off from GDP.

  9. Firstly we used to hear that population is one of the most problematic scenario, but as days have gone everything has been changed. Today the most bubble bursting topic is Debt which have gone beyond the sky limits and in fact have left the population way back. Now population is nothing in front of huge debt and it’s the problem all over the world.

  10. The matter according to me has been thrown in dust-bin and diplomats are having fun with the increased rates and economy. Quite astonished that the people who are answerable for such situation for rising debt are playing with the economy. If some serious won’t be applied immediately then I don’t think there would be anything left for anyone.

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