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Large US household balance sheets pose macro risks

Wednesday, October 13, 2021


An examination of the factors behind the expansion indicates that outsized balance sheets will persist and will pose a number of macroeconomic risks.


  • Slower workforce growth will pressure GDP growth, trade growth and long-term interest rates, unless productivity gains can offset this.
  • A record number of US business deaths and births in 2020 will affect productivity and have unpredictable impacts on the economy.
  • Lower growth makes it harder to stabilise debt-to-GDP ratios, just as pension and health costs rise as populations age in major economies.
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