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Goldman Sachs Warns “Too Much Debt” Threatens World Economy

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Goldman Sachs Warns "Too Much Debt" Threatens World Economy

- Debt load of many countries is an economic risk
- Ageing populations in developed world to put pressure on economies
- Goldman proposes "creative" social policy to deal with looming crisis
- Entire debt-based monetary system needs reform

goldcore_chart1_29-05-15

The debt burden – particularly in "developed" countries – along with ageing populations poses a risk to the economies of those countries, Goldman Sachs has warned. Andrew Wilson, Goldman Sachs Asset Management's chief executive in Europe said, "There is too much debt and this represents a risk to economies. Consequently, there is a clear need to generate growth to work that debt off but, as demographics change, new ways of thinking at a policy level are required to do this."

Japan, as an example of a major economy, now has a government debt-to-GDP ratio of over 200%, which Wilson says is "not sustainable over the long term." Other countries with very high debt loads include the U.S., most of Europe and Brazil.

Among those countries on the other end of the scale are Russia, other central Asian countries and most of the Gulf states demonstrating the latent and as yet widely unacknowledged strength of the emerging Eurasian Economic Union and its ties to the Chinese New Silk Road project.

Wilson is particularly focussed on the issue of an ageing population:

"The demographics in most major economies – including the US, in Europe and Japan – are a major issue – and present us with the question of how we are going to pay down the huge debt burden. With life expectancy increasing rapidly, we no longer have the young, working populations required to sustain a debt-driven economic model in the same way as we've managed to do in the past."

Goldman proposes that society should bend to the needs of the financial and monetary system rather than reform of that system. "The demographic shift means that we need to look to more creative policy, including immigration and workforce expansion in order to find ways to pay down debt." He lauds prime Minister Shinzo's drive to increase female labour participation and efforts to boost inflation in Japan.

Peter Sutherland, who retired as head of Goldman Sachs International earlier this month after 20 years, has shown great interest in migrant affairs in recent years.

According to the Financial Times, "His main activity in retirement will be his role as a special representative of the Secretary-general of the UN for Migration and Development. Mr Sutherland recently spoke on Irish national radio about his support of EU proposals that would share the burden of migrants more broadly across the continent."

Sutherland was quoted as saying,

“The fundamental issue here is saving people who are drowning in the Mediterranean...this is not about getting into battles about quotas when we are facing a humanitarian crisis.”

While we are in favour of any measures that may relieve the hardship suffered by people in parts of the world where life can be more harsh, we are not convinced that using migration as a tool to deal with a broken system is a wise policy. Migration should be a natural process, not one that is orchestrated by the most powerful people in our society.

Unless and until the debt-based money system is reformed there will always be debt-related crises. Almost all currency today comes into existence as interest on existing debt. Debt cannot be repaid unless new debt is created. This process leads to ever greater amounts of debt.

goldcore_chart2_29-05-15

This global money system – from which Goldman Sachs derives such immense benefit – actually creates, to a considerable extent, the environment where emigration becomes imperative.

At any rate, the proposals put forward by Goldman are unlikely to achieve any kind of long-term solution to the problem of massive unsustainable debt faced by the western world and Japan. If central banks begin to raise interest rates to more normal levels a debt crisis will likely ensue.

The longer central banks wait before raising rates, the greater the bubbles in financial assets will grow and the greater the eventual crisis will be. Either way a financial, currency and economic crisis seems unavoidable at this point.

Such a crisis would likely involve bail-ins of deposits in bank accounts as banks and governments struggle to deal with wave after wave of defaults. Physical gold, held outside of the banking system is an essential form of insurance against such crises. We offer storage in the most trusted facilities in the world in very safe jurisdictions such as Switzerland and Singapore.

Must-read guides:
Protecting Your Savings In The Coming Bail-In Era
From Bail-Outs To Bail-Ins: Risks and Ramifications

 

MARKET UPDATE

Today’s  AM LBMA Gold Price was USD 1,190.40, EUR 1,083.86 and GBP 778.24 per ounce.
Yesterday's AM LBMA Gold Price was USD 1,189.45, EUR 1,087.08  and GBP 775.94  per ounce.

Gold climbed $1.00 or 0.08 percent yesterday to $1,188.50 an ounce. Silver rose $0.01 or 0.06 percent to $16.70 an ounce.

Gold in USD - 1 Week
Gold in USD - 1 Week

Gold in Singapore for immediate delivery was steady at $1,187.90 an ounce while gold in Zurich was also little changed as it continues to be capped below $1,200 per ounce.

Gold inched up on Friday in London as the U.S. dollar pulled back, but the yellow metal still remained on track for its second weekly decline of about 1.5 percent.

U.S. GDP figures are out at 12:30 pm today.

Although Greek officials seem optimistic that they can negotiate a deal before the weekend, IMF director Christine Lagarde has cautioned that Athens is unlikely to agree any deal in the next few days and that “a Greek exit is a possibility”.

In late morning European trading gold is up 0.11% at $1,190.00 an ounce. Silver is up 0.16 percent at $16.74 an ounce and platinum is down 0.02 percent at $1,117.68 an ounce.

Breaking News and Research Here

 

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Sat, 05/30/2015 - 13:39 | 6147045 dizzyfingers
dizzyfingers's picture

And who is responsible for soliciting debt? Who were the entities back in the 60s giving "credit" cards to every taker? And same throughout the decades up to and including now? Hmmmm?

Sat, 05/30/2015 - 11:35 | 6146844 kchrisc
kchrisc's picture

"The demographic shift means that we need to look to more creative policy, including immigration and workforce expansion in order to find ways to pay down debt."

The one and ONLY way to increase prosperity is to produce more for less--increased productivity. To bring in more people to produce the same for less is just additional slavery and poverty for the benefit of the elites--more toil and poverty for us, so there is more for them to have and to enjoy.

My guillotine says "ney, ney" to that.

Liberty is a demand. Tyranny is submission..

 

I don't like the site of blood, but if it's banksters' blood, I'll get over it.

Sat, 05/30/2015 - 10:54 | 6146757 Herdee
Herdee's picture

She's a classic oldie and Tyler was right on then as he is now.

http://www.zerohedge.com/news/debt-bomb-bailout-oooh-you-turn-me

Never hurts to look at history:http://www.zerohedge.com/article/paging-ken-rogoff-cbo-revises-budget-de...

Sat, 05/30/2015 - 10:20 | 6146689 falga
falga's picture

All Kings used to forgive debt From time to time going back to the babylonian Kings ... Like a reset button

GS is right there is too much debt that needs to be written off, let them forgive the debt owed to them first...

Sat, 05/30/2015 - 08:17 | 6146513 Optimusprime
Optimusprime's picture

All systems based on usury are unjust and will fail.  They must then be replaced by non-usurious alternatives, or the same old shit will re-commence.  The best minds need to bend themselves to this task.  All else useless palaver.

Sat, 05/30/2015 - 07:10 | 6146454 SystemOfaDrown
SystemOfaDrown's picture

Oh come on! We're only in the trillions. Lighten up!

Fri, 05/29/2015 - 23:57 | 6146141 lunaticfringe
lunaticfringe's picture

What exactly is "long term?" From the piece:

Japan, as an example of a major economy, now has a government debt-to-GDP ratio of over 200%, whichWilson says is "not sustainable over the long term."

It's been 25 years since Japan melted down. So when the author says giant debt to GDP ratios are not sustainable over the long term- who the fuck is he trying to kid? Are we talking geologic time, like the fucking Cretaceous period? Cause I gotta tell ya- 25 years has been a big chunk of my lifespan and it is only getting larger.

Fri, 05/29/2015 - 23:55 | 6146138 malek
malek's picture

Did they forget to ask K-rug on that?

Fri, 05/29/2015 - 21:21 | 6145834 P'Od_Accountant
P'Od_Accountant's picture

since every unit of currency is circulation is debt, I tend to agree with them to extent that we need to completely redesign the economy and abolish the slavers.

Sat, 05/30/2015 - 02:19 | 6146310 GuusjA
GuusjA's picture

De ongekende invloed die de wereldvoetbalbond FIFA heeft op de evoluerende werkelijkheid (banksaldo 1,4 miljard euro) kon alleen maar geschieden doordat Blatter de norm 'ieder land voor zich en de absolute waarheid voor ons allen' goed heeft toegepast. De reden dat hij gisteren weinig verrassend voor een vijfde termijn van vier jaar werd gekozen als voorzitter. 

 

http://www.trouw.nl/tr/nl/4508/Sport/article/detail/4042936/2015/05/29/D...

 

Het boerkaverbod, waartoe netwerk @MinPres vorige week besloot, is het teken dat de cultuur van 'zwijgen is goud' ten einde is.

 

http://www.trouw.nl/tr/nl/6924/Theologisch-elftal/article/detail/4042307...

 

Nu de vraag hoe Marianne Thieme het voor elkaar krijgt dat ook 'een elftal van dieren' mee mag doen met het WK-voetballen.

 

http://www.volkskrant.nl/binnenland/partij-voor-de-dieren-profeet-van-de...

Sat, 05/30/2015 - 06:17 | 6146423 GuusjA
GuusjA's picture

RuitenAas: "één land gaat in de 3e SpinozaGolf veel verder en veel sneller dan alle andere"!

 

http://nos.nl/artikel/2038551-vs-china-moet-nu-stoppen-met-landwinning-c...   

 

De Engelsman David Gill heeft zijn zetel in het dagelijks bestuur van de FIFA opgegeven, om zo zijn rol in de 3e SpinozaGolf te verdoezelen. 

 

http://www.volkskrant.nl/sport/vice-voorzitter-engelse-bond-stapt-uit-fi...

 

De 79-jarige Blatter, die gisteren werd herkozen als voorzitter van de wereldbond FIFA, sprak van “haat, die niet alleen van één persoon bij de UEFA komt, maar van een organisatie die niet wil dat de waarden van het systeem 'Leven en Laten Leven' wordt uitgetest. 

 

http://www.nrc.nl/nieuws/2015/05/30/blatter-haalt-uit-naar-uefa/?utm_cam...

Sat, 05/30/2015 - 06:38 | 6146434 GuusjA
GuusjA's picture

Science is not only about lab coats and lectures. Media allows us to make anyone a scholar and put them right in the midst of engaging scientific action. The science we take part in is zestful and adventurous.

 

http://aquatilis.tv/

 

Lloyd krijgt de beschikking over een budget van omgerekend 8,4 miljard euro om de waarden van het systeem 'Leven en Laten Leven' uit te testen. 

 

http://www.volkskrant.nl/buitenland/manchester-krijgt-een-ongekozen-dict...

 

False Flag info: 

 

http://www.infowars.com/secret-meeting-in-london-to-end-cash/

Sun, 05/31/2015 - 13:01 | 6149403 lunaticfringe
lunaticfringe's picture

Whatthefuckisthisgibberish?

Fri, 05/29/2015 - 20:45 | 6145753 doctor10
doctor10's picture

Expecting the fox to secure the henhouse is a little silly indeed now

Fri, 05/29/2015 - 19:22 | 6145500 rsnoble
rsnoble's picture

Wow. A bit late.  But they already got their free trillions for fucking up so now they can preach to the rest of us.

Fri, 05/29/2015 - 18:44 | 6145407 harrybrown
harrybrown's picture

There is virtually no debt anywhere in the world...
because it was all created "unlawfully" rendering it void,
or people could be complete fuckwits & just believe the jews press & govt's & keep slaving for them

If no one believes in the debt then its un enforceable...

until they arrive with tomahawks & some dumb soldiers to deliver them >cough<

Sat, 05/30/2015 - 11:38 | 6146856 kchrisc
kchrisc's picture

The banksters need to repay us.

Liberty is a demand. Tyranny is submission.

Fri, 05/29/2015 - 18:17 | 6145344 koan
koan's picture

Blame the old people!!! Burn them burn them!!!

Fri, 05/29/2015 - 18:13 | 6145330 Lazane
Lazane's picture

I like greenlands plan to get out of debt

Fri, 05/29/2015 - 18:12 | 6145327 Lazane
Lazane's picture

you don't say, how bout that mr goldman, anyone flush for a haircut?

Fri, 05/29/2015 - 17:32 | 6145187 MrBoompi
MrBoompi's picture
Goldman Sachs Warns “Too Much Debt” Threatens World Economy

Then right after making this statement they borrowed a boatload of money and made a shitload of loans.

Fri, 05/29/2015 - 17:16 | 6145121 pndr4495
pndr4495's picture

Goldman themselves should have been declared insolvent as a result of the Global Financial Crisis, overwhelmed by the debt they would have incurred because of their speculative trading book. They bought their protection in 1913, however.

Fri, 05/29/2015 - 16:51 | 6145042 TeethVillage88s
TeethVillage88s's picture

"...we are not convinced that using migration as a tool to deal with a broken system is a wise policy. "

Like having open borders so that new citizens with clean credit history can come in and add liquidity.??

I heard Japan is negotiating with Myranmar to migrate Japanese citizen refugees to the former Burma. I guess they would start new Japanese Banks and give those citizens clean credit history? (Fukushima Refugees)

If Goldman Sachs was only one big bank in New York with all the business... and their name was Rothschild Bank, then we would know who to blame for extending so much credit and the Finance/Banking/Economic/Sub-Prime Credit Models on the USA.

Funny I don't remember any of these Self Regulating guys putting great effort into Reforming the Corrupt System.

These Self Promoters like to compare themselves with God.

Fri, 05/29/2015 - 15:22 | 6144725 starman
starman's picture

They just figured  this out? Little late I'd say.

Fri, 05/29/2015 - 14:52 | 6144620 cashtoash
cashtoash's picture

Didn't Bernake say debt is good, the more the better.  Did Goldman not hear Ben or were they too busy trading?

Fri, 05/29/2015 - 13:59 | 6144394 fremannx
fremannx's picture
Goldman Sachs Warns “Too Much Debt” Threatens World Economy

They just figured this out? Are you kidding?

http://www.globaldeflationnews.com/anatomy-of-a-bubble-how-the-federal-r...

Fri, 05/29/2015 - 13:41 | 6144336 who cares
who cares's picture

Goldman just Sucks!

Fri, 05/29/2015 - 13:06 | 6144223 GreatUncle
GreatUncle's picture

Is GS trying to justify the future sovereign bail ins? The new creative economic policy.

Notice also, GS will not accept any change to the economic policy that does not preserve their current position so it will be more of what GS have already done and the others over the last century.

Priceless when it is those holding all the wealth who need to consume a large proportion or have it taken in a direct bail in = taxation. System is so unbalanced that taxation = bail in can only ever be small from the population as a whole because the net worth held by the population is too small.

As for the removal of cash, reckon that cripples a fair portion of the economy although under such a system the total income of peoples will finally be revealed so no more black economy bollocks to make ends meet. At that point government and government alone with no cash based black economy will be financially responsible for the financial outcomes in peoples lives. ACTUALLY I LOVE THAT CONCEPT, THE ROPE THAT HANGS SOVEREIGNS WHERE NO FRAUDULENT CLAIMS BY ELITES (YES THEY DO SPEND CASH) WILL NEVER EXIST AGAIN.

Ther cashless society is a move to full blown socialist economy and if pursued captialist economics has to die.

Fri, 05/29/2015 - 14:54 | 6144219 John Law Lives
John Law Lives's picture

"The demographic shift means that we need to look to more creative policy, including immigration and workforce expansion in order to find ways to pay down debt." - Goldman

I believe this is at the very core re. why so many elected officials (be they Republican or Democrat) publicly support a relaxed national immigration policy.  Corporations WANT more citizens because they believe having more citizens will lead to increased consumption.  I believe normalization of relations with Cuba is also driven by corporations who want a crack at building up Cuba's infrastructure etc. 

Corporations own both parties.  They don't want walls built between the US and other nations.  They want expressways.

Fri, 05/29/2015 - 12:34 | 6144107 the grateful un...
the grateful unemployed's picture

if a robot replaces you and the robot can do twice as much work, never eats, or sleeps, then maybe 200% debt to GDP is acceptable. who is going to buy those robot manufactured goods? not people who must have a paycheck to earn their money. so government steps in and gives them money to spend. .they buy all the robot goods there are, and the economic numbers do pretty well, if only the government can figure out how to pay people a stipend without going broke. its the old productivity number. the pertinent issue is the right of those former workers to collect the cash from the work their robot counterparts are doing,, otherwise the robot owners get rich and the economy stagnates. we can only guess how this comes out, or we can make a conscious effort to reclaim the intellectual property that the robot owners took from us. 

Fri, 05/29/2015 - 11:40 | 6143901 BoPeople
BoPeople's picture

***Goldman proposes that society should bend to the needs of the financial and monetary system rather than reform of that system. "The demographic shift means that we need to look to more creative policy, including immigration and workforce expansion in order to find ways to pay down debt."***

I think not. All of the banks should bend to the needs of the people and liquidate ALL of their assets (deposits are a liability owed to the people) and if they cannot pay the people who they owe, then they need to distribute ownership of their companies to those who they owe.

The same goes for the governments of the world. Liquidate the insolvent government and their holdings and make the people of the country owners of the governments with full ownership rights and protections.

Fri, 05/29/2015 - 12:03 | 6143982 Dizzy Malscience
Dizzy Malscience's picture

Hey, Sac..

WTF is going on with the threads database   ???

 

Fri, 05/29/2015 - 20:21 | 6145694 Dizzy Malscience
Dizzy Malscience's picture

OT here, but who gives a F.

Sunday, the Patriot Act will expire unless replaced by the “Freedom Act”

WTF.. “Freedom Act” .. is that like “Health Care Affordability” ??

Obama is worried about the intelligence collection going “dark”.

Somebody please tell me where the problem would be here?

 

Fri, 05/29/2015 - 11:33 | 6143877 Bay of Pigs
Bay of Pigs's picture

Coming from the people who loaded up Greece with CDS's and all kinds of other bullshit that sunk their economy, banks and the country.

Friday Humor?

Fri, 05/29/2015 - 16:55 | 6145055 TeethVillage88s
TeethVillage88s's picture

Hey check the right hand in the photo holding the sign up.

Isn't that a coke fingernail on the ring finger. Kind a long for a dude.

"Coming from the people who loaded up Greece with CDS's...."

Yeah good point. Lots of these banks keep getting bailouts.

Systemic Bad Loans/Debt, Systemic Bad Management, Systemic Manipulation of the Taxpayer and Governments.

Fri, 05/29/2015 - 11:32 | 6143866 BoPeople
BoPeople's picture

To state the obvious: Having a global financial management philosophy that is built on inflation requires increasing amounts of debt to support.

The FALSE growth paradigm requires increasing amounts of debt to support.

In the past, it may have been possible for debtors to pay off at least the interest on their debt with labor. The global central banking system and the international banks through a concerted effort have since made it impossible for debtors to pay off their interest and balance the economies with their labor. The banks accomplished this through rampant inflation and financialization.

Seeing that Goldman was a key actor in unbalancing the economies of the world and enslaving both governments and people to debt and the interest that it carries, I find it ironic that they are now trying to position themselves as a voice of reason. Goldman more than any other entity embodies Ponzi debt and asset inflation strategies ... passing an asset from one debtor to another successively enriching themselves with no "value" add in the process.

We have to assume, given Goldman's past, that this current tact is simply a fraud designed to drive us to another treasonous (against the people of this world) scheme to enrich themselves and gain more power.

Talk to "The Hand".

Fri, 05/29/2015 - 11:12 | 6143766 mtl4
mtl4's picture

GS is just pissed because they won't be able to get their risky deals bailed out when this pesky soverign debt thing comes home to roost.

Fri, 05/29/2015 - 11:03 | 6143757 great_scot
great_scot's picture

You have too much debt...

 

... why not consolidate it into this one easy loan?

Fri, 05/29/2015 - 11:02 | 6143756 CHC
CHC's picture

And going totally cashless - all digital - would cure all the world problems too!!  What a bunch of mother fuckers.

Fri, 05/29/2015 - 10:58 | 6143729 willien1derland
willien1derland's picture

NEWFLASH - Goldman Sachs identifies Pope Francis as Catholic...In order to provide Muppet clients with hedging options Blankfein requests that the Vatican allow Goldman to act as its agent to sell Indulgence Derivatives...Film at 11

 

Fri, 05/29/2015 - 11:53 | 6143946 KnuckleDragger-X
KnuckleDragger-X's picture

I hear they are hot on the trail of the mysterious animal shitting in the woods.....

Sat, 05/30/2015 - 05:54 | 6146414 HowdyDoody
HowdyDoody's picture

Let me guess - they are bearing down on it.

Fri, 05/29/2015 - 10:51 | 6143702 divingengineer
divingengineer's picture

And who sold em that debt?

 

Jerks

It's like a liquor store owner talking about people drinking too much. 

Fri, 05/29/2015 - 11:16 | 6143810 KnuckleDragger-X
KnuckleDragger-X's picture

Yeah, GS helped steer the ship toward the iceberg and are now complaining about the crumpled sheetmetal. Not to worry though, they undoubtedly have an investment to 'help' the sheep.....

Fri, 05/29/2015 - 10:41 | 6143668 HenryHall
HenryHall's picture

Lenin had a simple solution to the problem of too much debt.

Sat, 05/30/2015 - 01:10 | 6146254 Troy Ounce
Troy Ounce's picture

Shoot the lender?

Fri, 05/29/2015 - 11:27 | 6143807 Captain Debtcrash
Captain Debtcrash's picture

 Goldman must be heading up the department of redundancy department.  Yeah we've figured out the level of total credit market debt is bad. 

 

Thanks Captain Obvious       

 

Fri, 05/29/2015 - 12:00 | 6143980 JRobby
JRobby's picture

How much of the too much did Goldman underwrite?

Scumbags

Sat, 05/30/2015 - 05:53 | 6146413 HowdyDoody
HowdyDoody's picture

Given Goldman Sachs is odious, any debt they claim should be considered an Odious Debt.

Fri, 05/29/2015 - 11:55 | 6143957 whotookmyalias
whotookmyalias's picture

Uh......

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