UK household debt reaches peak

Article of the week – Harjot M.

High levels of household debt pose a risk to the economy because any increase in interest rates could lead to a sudden collapse in consumption. Higher borrowing costs mean households have less discretionary income resulting in a fall in consumer spending. Aware of this risk, firms may consider cutting investment in the expectation of a fall in future demand. Consequently, aggregate demand decreases causing a fall in inflationary pressures, a decrease in economic growth and, potentially, an increase in demand-deficient unemployment.

Column: Is China’s economy a house of cards? | PBS NewsHour

While doomsday warnings about the Chinese economy run rampant in the Western media, it is quite likely that the Chinese government will, in fact, be able to manage the economic, social and political tensions it faces.

Source: Column: Is China’s economy a house of cards? | PBS NewsHour

Article of the week (part 2), courtesy of Darcey Edkins (summary to follow).