Public and Private Debt Hits Frightening New Record: $164 Trillion Worldwide…


Public and Private Debt Hits Frightening New Record: $164 Trillion Worldwide

There's a saying by Warren Buffet: "Only when the tide goes out do you discover who's been swimming naked." This phrase is meant to illustrate how foolish choices will eventually catch up to a person, especially in the financial world. When things go wrong, mistakes will come back to haunt you.

Across the world, both private individuals and governments are swimming naked in $164 trillion of debt. That's 225% of the entire world GDP.

"The world’s debt load has ballooned to a record $164 trillion, a trend that could make it harder for countries to respond to the next recession and pay off debts if financing conditions tighten, the International Monetary Fund said."

Here's the thing with debt: it makes life harder. With it you can get all sorts of things you want in the short term, like a car, or a new sectional, or any number of things, but later on debt creates problems. You have to send your money out the door and you have less of it. When hard times come around, you'll find you have even less than that.

As someone who is working furiously to get out of debt, I find it simply mind-boggling how people can just keep piling on debt like this, expecting everything to be just fine and dandy. Doesn't work that way. It will catch up at some point. There will be some market correction in the economy as a whole or in one person's household economy.

I'm preparing for that by getting out of debt as quickly as possible. I can only hope that by sharing this someone else will want to get out of debt and turn their life around as well.