Debt ratios have reached extreme levels across all major regions of the global economy, leaving the financial system acutely vulnerable to monetary tightening by the US Federal Reserve, the world’s top financial watchdog has warned.

My Comment:  I would say it's a safe bet that the FED will NOT be raising interest rates in the very near future. The FED just wants to make it look like they are ABLE to raise them, and that the market is healthy enough to do so. But in reality, it's just for show. There is no way that raising the interest rates now is realistic. As many reliable economists have pointed out, it can't be done right now without collapsing the market.

The Bank for International Settlements said the wild market ructions of recent weeks and capital outflows from China are warning signs that the massive build-up in credit is coming back to haunt, compounded by worries that policymakers may be struggling to control events.

“We are not seeing isolated tremors, but the release of pressure that has gradually accumulated over the years along major fault lines,” said Claudio Borio, the bank’s chief economist.

The Swiss-based BIS said total debt ratios are now significantly higher than they were at the peak of the last credit cycle in 2007, just before the onset of global financial crisis.

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