Shocking Debt to Asset Ratios

Jeremy Grantham Money Manager at GMO says,

• U.S. Had $50 Trillion Total Assets
• Supported by $25 Trillion in Debt (personal and corporate)
• 50% debt to asset ratio

• U.S. Has $30 Trillion Total Assets
• Supported by $25 Trillion in Debt
• 83% debt to asset ratio

Debt needs to be a 40% of assets…which means that we need to decrease our debt by nearly 60% or approximately $15 Trillion.

1. Write Down Debt Now
2. Be Like Japan: Wait It Out
3. Inflate Our Debt

All three will require “lots of pain.”