David McWilliams: Private debt so enormous that default is only option
When all the people you read every week for information are talking about the same report, you know that you should read it. From Paul Krugman on the left to John Mauldin on the right, some of my favourite reads of the week are citing a McKinsey Consulting* report on global debt.
Reading through it, one chart jumped out at me. Have a look at the chart. Yes, the one accompanying this article. It is taken from data of the Bank of International Settlements. It shows just how much debt the Irish economy is carrying. What it tells you is that Ireland is the most indebted country in the world. When compared with Greece, Ireland is carrying more than two-and-a-half times more debt. We are twice as indebted as Portugal.
This deterioration happened when we were members of the euro. When we borrowed hand over fist from German and British banks in particular.