Within the financial sector, de-leveraging is well advanced. In the real economy it is in the early stages.
I would say under way but not yet peaked from the financial sector.
Ultimately, "all the king’s horses and king’s men" cannot prevent the de-leveraging of the financial system under way. The extent of de-leveraging is substantial and likely to take time. In recent years, money was cheap and other assets were expensive. As each of the global economy’s credit creation engines breaks down and systemic leverage reduces, money becomes scarce and more expensive triggering substantial adjustments in asset prices in a reversal of the process.
Things will become very cheap. If you have any money left
David Roche of Independent Strategy, a consulting firm, estimates that $4 to $5 of debt is now required to generate $1 of economic growth. As credit creation slows and debt levels fall, the sustainable level of global economic growth may fall as well.
Of interest to this thought is the difference between $4 available then and what will be available in the future. I would guess it will be a long time before growth is seen
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