In the wake of the financial crisis, everyone has made efforts to deleverage their balance sheets, which has been a tremendous hindrance on economic growth.
“In the US, we consider this well-advanced for households, but more is needed in the government sector,” write the analysts at Societe Generale. “Turning to Europe, we still see icy headwinds from deleveraging, and notably in Spain and the UK.”
Here’s a set of charts SocGen provided, which gives a snapshot of leverage in the developed world:
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