Keen: Financial Sector Debt Rose from 2% of GDP in 1945 to 120% of GDP in 2008
Some shocking #’s in this clip re: financial sector (bank) debt. In the U.S. there’s more of it than total consumer debt. Banks have debt equivalent to 120% of GDP. It’s hot money, and it’s fueling misallocation of capital in countless areas.
Clip starts at 16:00, though the rest of the video is worth a watch. Not just because Lauren Lyster is hot.
So next time you’re wondering why ZIRP is here, don’t. The banks want cheap access to capital, and they own the Fed. Literally.