那提西银行-全球-宏观经济-为什么债务危机导致进一步的债务危机？-20171127-NATIXIS-Flash_Economics：Why_do_debt_crises_lead_to_further_debt_crises？_7页_444kb

Flash Economics Summary

Core Content

This document discusses the cyclical nature of debt crises and how expansionary monetary policies implemented in response to these crises can inadvertently lead to further debt accumulation, thereby setting the stage for subsequent debt crises.

Main Debt Crises and Their Causes

• 2000 Crisis: Primarily driven by excessive corporate debt, linked to an equity market bubble. This led to a decline in corporate investment.
• 2008 Crisis: Caused by excessive household debt, connected to a real estate price bubble. This resulted in a drop in housing investment.
• 2011-2013 Euro Zone Crisis: Triggered by public debt issues, leading to a correction of fiscal deficits.

Expansionary Monetary Policies

In response to these crises, central banks adopted expansionary monetary policies to:

• Prevent borrower defaults
• Boost economic demand
• Reduce interest payments on debt

These policies included:

• Lowering interest rates
• Increasing money supply
• Providing liquidity to financial institutions

Why Debt Crises Lead to Further Debt Crises

The expansionary monetary policies introduced during a debt crisis often lead to:

• A resumption of borrowing
• An increase in debt ratios
• A foundation for the next debt crisis

This is evidenced by the following trends:

• 2002-2008: Private debt increased
• 2007-2017: Public debt rose
• Since 2012 in the US: Corporate debt rebounded

These trends are illustrated in the charts provided, showing the growth in loans to households, business loans, and public debt over time.

Conclusion: Preventing Succession of Debt Crises

To prevent a debt crisis from leading to another, the following approach is recommended:

• Combine Expansionary Monetary Policy with Restrictive Macroprudential Policy
• Implement measures such as:
  • Adjusting banks' regulatory ratios (e.g., capital ratio, required reserves ratio)
  • Modifying lending rules (e.g., loan-to-value ratio)

This dual approach would help to prevent the resumption of borrowing and mitigate the risk of future debt crises.

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Disclaimer Highlights

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