Global debt continues to rise. There is threat that interest rates may hike due to issues with high inflation. 1. Household debt - https://financialpost.com/investing/david-rosenberg-canadas-debt-binge-is-not-good-for-the-economys-future-or-the-loonie 2. Household debt - https://en.yna.co.kr/view/AEN20211020008600320 3. Mortgage - https://www.canadianmortgagetrends.com/2021/10/mortgage-debt-growing-at-fastest-pace-in-a-decade-cmhc/ 4. In arrears - https://cba.ca/mortgages-in-arrears 5. Global debt - https://www.business-standard.com/article/international/global-debt-jumps-to-new-high-of-226-trillion-says-imf-report-121101301387_1.html 6. Piling on debt - https://globalnews.ca/news/8274309/canadian-debt-quality-of-life-covid-19-bdo-survey/ 7. Evergrande - https://www.ft.com/content/b8effeb7-e553-4bb1-8ece-a610fcbcdbb2 8. Stablecoins - https://markets.businessinsider.com/news/currencies/stablecoin-tether-crypto-usdc-diem-risky-debt-market-fitch-regulation-2021-10 9. Foreign debtors and Canada - https://www.advisor.ca/investments/market-insights/foreign-investors-snap-up-canadian-debt-statscan/ 10. China and debt - https://www.reuters.com/world/china/what-lies-beneath-hidden-debt-fears-feed-chinas-property-woes-2021-10-20/ 11. USA corporate debt - https://www.bloomberg.com/news/articles/2021-01-28/credit-investors-worldwide-are-piling-into-u-s-corporate-debt?utm_medium=cpc_search&utm_campaign=NB_ACQ_DSAXX_DSATESTTCPAXX_EVG_XXXX_XXX_COALL_EN_EN_X_BLOM_GO_SE_XXX_XXXXXXXXXX&gclid=CjwKCAjwn8SLBhAyEiwAHNTJbVyg1ZvAr9RAcNTHgq36_v0BA4ZUtQXDU7W950B_5blUi8VsmAzaSRoCjOcQAvD_BwE&gclsrc=aw.ds 12. Yields - https://www.wsj.com/articles/the-market-is-right-to-be-spooked-by-rising-bond-yields-11633142803

1. WOODGROVE
BANK
DEBTISSUES–CANADA
ANDTHEWORLD–
ANALYSIS
By: Paul Young, CPA, CGA
October 21, 2021

2. WOODGROVE
BANK
PAULYOUNG - BIO
• CPA, CGA (1996)
• Academia (PF1, FA4, FN2, MU1. and MS2)
• SME – Customer Success Management
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Emerging Technology
• SME – Business Process Change
• SME – Financial Solutions
• SME – Macro/Micro Indicators
• SME – Supply Chain Management
• SME – Data, AI, Security, and Platform
• SME – Internal Controls and Auditing
Contact information email: Paul_Young_CGA@hotmail.com
LinkedIn: https://www.linkedin.com/in/paul-young-055632b/
SlideShare - https://www.slideshare.net/paulyoungcga
Twitter: https://twitter.com/paulyoungcpa
Youtube - https://www.youtube.com/user/youngercga1968/videos

3. WOODGROVE
BANK
• This presentation is one perspective on Debt. It is not the only view. People are more than
welcome to visit other sites like BEA, Stats Canada, OECD, Banks, etc.

4. WOODGROVE
BANK
AGENDA
• What is debt
• Types of debt
• Market Forecast
• Government Debt
• Fitch and Canada
• Corporate Debt
• Bank Stress Testing
• Safest banking systems in the world
• Consumer Debt
• City/Local Government
• Global TV / Canada Debt
• Canada bonds downgraded
• Fintech
• Shenzhen China
• COVID19 / Bankruptcies
• Cash flow
• Training and Development

5. WOODGROVE
BANK
INTEREST RATES
5
Source -https://www.morganstanley.com/ideas/bond-market-outlook-2021 or
https://www.theglobaltreasurer.com/2021/05/10/interest-rate-risk-identifying-and-measuring-core-
factors/ or https://blogs.imf.org/2021/04/22/understanding-the-rise-in-us-long-term-rates/

6. WOODGROVE
BANK
WHAT IS DEBT
• Debt is an amount of money borrowed by one party from another. Debt is used by many
corporations and individuals as a method of making large purchases that they could not afford
under normal circumstances. A debt arrangement gives the borrowing party permission to borrow
money under the condition that it is to be paid back at a later date, usually with interest.

7. WOODGROVE
BANK
TYPES
DEBT /
SEGMENTS
Corporate/Business
Household Debt
Government

8. WOODGROVE
BANK
GLOBAL FORECAST
What drives an Economy?
• Consumer Spending
• Exports
• Government Spending
Source - http://www.scotiabank.com/ca/en/about/global-
economics/economics-publications.html
BNS_Global
Forecasts_20212010.pdf

9. WOODGROVE
BANK
DEBTAND CANADA/
COVD19
9
http://www.cbc.ca/news/politics/canada-election-2015-justin-trudeau-affordable-
housing-1.3220479
Rebuttal
1. RRSP Borrowing - http://business.financialpost.com/personal-
finance/retirement/rrsp/forget-tfsas-and-resps-debt-now-the-biggest-challenger-
to-rrsps-when-it-comes-to-where-to-stash-your-money. So, JT supports Harper’s
expanding RRSP, but yet JT has said people are not saving enough for retirement -
http://ralphgoodale.ca/blog/canadian-middle-class-disappointed-frustrated/. Does
this not contradict Goodale’s statement?
2. Commitment for $20B over 10 years for social housing. It seems there are land
issues in cities like Toronto/Vancouver as such how will that additional money
provide more affordable housing and not drive out real estate prices more in those
cities? What about the waste? http://www.torontosun.com/2015/06/07/former-
to-social-housing-boss-lands-in-chicago
3. Justin Trudeau asked the experts? Who are these experts?
McCallum/Brison/Goodale?
https://www.central1.com/sites/default/files/uploads/files/analysis_report/report
_file/Housing%20myths.pdf
Summary:
It is funny how both the NDP and LPC throw out new policies including new moneys,
but do not deal with issues facing various policies. It seems to me that the statements
are narrow minded that do not look at all angle of policies.
Household debt was a 2015 election

10. WOODGROVE
BANK 10
FITCH / CANADA
Source – Fitch -
https://www.fitchratings.com/research
/sovereigns/canadas-growing-deficit-
raises-fiscal-consolidation-risks-27-
08-2020
• Canada will need to get its
fiscal house in order or
there could be another
downgrade of Canada’s
debt -
https://www.slideshare.net/
paulyoungcga/fiscal-
management-canada-
defict-and-debt

11. WOODGROVE
BANK
GOVERNMENT
DEBT
• COVID19 has led to fiscal management issues for all levels of
the government -
https://www.slideshare.net/paulyoungcga/canada-and-
provinces-fiscal-and-economic-management or
https://www.slideshare.net/paulyoungcga/canada-municipal-
and-local-government-whats-needs-to-be-done
• China Debt - https://www.businessinsider.in/finance/chinas-28-
trillion-problem-the-dark-side-of-asias-
debt/slidelist/50383894.cms#slideid=50383917
• China debt with countries
• Developing countries -
https://www.straitstimes.com/opinion/china-lent-billions-to-
poor-countries-they-cant-pay-it-back
• Government Default
• Record defaults / 2020 -
https://www.fitchratings.com/research/sovereigns/sovereign-
defaults-set-to-hit-record-in-2020-12-05-2020-1
• Many government have Debt to GDP ratios 92% or above
• Government Debt (Bonds)
• Yields are based on credit ratings
• Government debt
• Deficits
• New debt financing (Infrastructure, operating
requirements, etc.)

12. WOODGROVE
BANK
GOVERNMENT DEBT
12
Source - https://ec.europa.eu/eurostat/statistics-
explained/index.php?title=File:General_government_debt,_2019_and_2020_(%C2%B9)_(General_government_consolidated_gross_debt,_%25
_of_GDP).png

13. WOODGROVE
BANK
DEBT TO GDP
13
Worldwide debt increased to $281 trillion and worldwide debt-to-GDP ratio is now over 355%. The Institute of International Finance’s global debt
monitor estimated government support programs were half of the rise, while global firms, banks and households added $5.4 trillion, 3.9 trillion and $2.6
trillion respectively.
During the 2008-2009 financial crisis the debt-to-GDP jumped 10 percentage points in 2008 and 15 percentage points in 2009. In 2020, the world
increased debt by 35 points from 320 to 355%. The debt spending is still increasing in 2021.
Global government debt is expected to increase by another $10 trillion this year and surpass $92 trillion. It is highly likely total world (government,
corporate, bank and household debt will pass $300 trillion by the end of 2021.

14. WOODGROVE
BANK
CORPORATE
DEBT
• The corporate debt of non-financial firms across major emerging
markets rose sharply from about $4 trillion in 2004 to well over $18
trillion in 2014 - (Source – IMF)
• In the past six years,” the report stated, “the global economy has
enjoyed a benign default environment as accommodative monetary
policies have fueled the corporate debt market with abundant
liquidity, allowing many low-rated issuers to refinance when
needed. The party is likely coming to an end soon as the global
default rate is expected to approach the historical average mark by
the end of 2016.” The default rate for all corporate debt is expected
to rise to 2.1%, Moody’s said. That is up from 0.9% in 2014 and
1.7% in 2015. It also would be the highest default rate since the
2008-2009 crisis. If the rate is realized, it would translate to 138
defaults this year, up from 109 in 2015 (a 30% increase) and 55 in
2014. (Source – Moodys)
• New corporate debt - https://www.axios.com/corporate-debt-
issuance-1-trillion-2020-b813ca2e-2a29-459b-afa5-
41299c987d12.html
• Cash Management - https://hbr.org/2020/01/why-are-companies-
sitting-on-so-much-cash or
https://www.spglobal.com/marketintelligence/en/news-
insights/latest-news-headlines/pandemic-spurs-record-cash-
hoarding-as-us-corporates-hold-2-5-trillion-8211-s-p-61647794
• Corporate Debt - https://seekingalpha.com/article/4363921-
corporate-debt-crisis-not-gone-away
• Balancing Debt - https://www.fnlondon.com/articles/the-unspoken-
crisis-underpinning-the-corporate-debt-bubble-
20210506?link=TD_fnlondon_home.27995a643976ebba&utm_sou
rce=fnlondon_home.27995a643976ebba&utm_campaign=circular
&utm_medium=FINNEWS

15. WOODGROVE
BANK
CORPORATE
DEBT
Source - https://www.cfo.com/credit-capital/2019/10/imf-
warns-of-19-trillion-corporate-debt-
risk/?utm_campaign=CFODailyAlert&utm_nooverride=1&ut
m_source=CFO-
email&utm_medium=email&utm_content=CFODailyAlert_
Wednesday_2019-10-16&utm_term=credit-capital
15

16. WOODGROVE
BANK
CORPORATE DEBT
16
• China state-own businesses and debt - https://www.aljazeera.com/economy/2020/11/13/china-
corporate-debt-defaults-trigger-concerns-of-broader-crisis
• Debt - https://www.scmp.com/economy/china-economy/article/3132511/chinas-debt-ratio-continued-
decline-first-quarter-economy
• Corporate debt and emerging markets - https://www.asianinvestor.net/webinar/emerging-
markets-corporate-debt-navigating-the-unknown/464580
• Corporate debt could impact the recovery - https://seekingalpha.com/news/3629236-s-and-p-
sees-global-debt-to-gdp-surging-to-2009-crisis-levels-in-2020
• Cash Hoarding - https://www.wsj.com/articles/cfos-using-bond-proceeds-to-pay-down-credit-
lines-debt-11603877403
• Cash Hoarding - https://www.narcity.com/canada-spending-is-way-down-it-has-resulted-in-a-170-billion-
cash-hoard
• Investors and cash hoarding - https://www.wealthprofessional.ca/news/industry-news/outlook-is-
improving-so-why-are-investors-still-hoarding-cash/355467

17. WOODGROVE
BANK
COVID19 AND DEBT
17
Source - https://www.weforum.org/agenda/2020/11/covid-19-has-countries-borrowing-money-just-about-as-quickly-as-
they-can-print-it/

18. WOODGROVE
BANK
STRESS TESTING BANKS
18
Source - https://www.gfmag.com/magazine/november-2019/worlds-safest-banks-2019

19. WOODGROVE
BANK
SAFEST BANKING SYSTEMS IN THE WORLD
19
Source - https://passportsymphony.com/countries-with-the-safest-banks/
1. Finland
2. Canada
3. Hong Kong
4. Norway
5. Singapore
6. Germany
7. Switzerland
8. Luxembourg
9. Sweden
10. Guatemala
11. Chile
12. Panama
13. South Africa
14. Belize
15. Vanuatu
• Government debt issues
• Zambia - https://www.bloombergquint.com/business/zambia-s-debt-
burden-hinders-access-to-imf-coronavirus-funds
• Banks taken loans provisions
• Canada write-downs - https://www.wsj.com/articles/canadas-banks-
take-earnings-hit-from-loan-loss-provisions-11590779182
• Tax Havens
• Luxembourg is Ranked #12
• Source - https://www.businessinsider.com/tax-havens-for-
millionaires-around-the-world-2019-11#12-luxembourg-4

20. WOODGROVE
BANK
HOUSEHOLD DEBT
Source: OECD
Household debt has risen markedly since
the turn of the century and stands at a
historically high level in most OECD
countries.
It examines the vulnerabilities associated
with high household debt for households,
the financial system and the wider economy.
Finally, it describes the challenges faced by
policymakers at the current juncture and
outlines responses in terms of monetary,
micro and macro-prudential, and housing
policies.

21. WOODGROVE
BANK
HOUSEHOLD DEBT
21
Source - https://mnpdebt.ca/en/resources/mnp-consumer-debt-index

22. WOODGROVE
BANK
CANADA
AND USA–
HOUSEHOLD
DEBT
Source - https://economics.td.com/impact-pandemic-financial
• CMHC new debt policies - https://www.ratespy.com/breaking-cmhc-rumoured-
to-tighten-its-mortgage-rules-impacting-first-time-buyers-060414150
• BOC warns about business and household debt -
https://nationalpost.com/pmn/news-pmn/canada-news-pmn/bank-of-canada-
warns-of-excess-business-household-debt-from-covid-19
• COVID19 - https://www.thesuburban.com/life/lifestyles/two-in-five-canadians-
have-no-plan-for-when-financial-supports-run-out/article_72fcad8c-1a31-11eb-
8e45-f761c77e9daa.html

23. WOODGROVE
BANK
CONSUMER CREDIT
23
Source – Scotiabank

24. WOODGROVE
BANK
HOUSING AFFORDABILITY INDEX
Source - https://www.numbeo.com/property-investment/rankings_by_country.jsp
2019
2015

25. WOODGROVE
BANK
USA – STATE AND LOCAL GOVERNMENT
25
• State Government – https://www.slideshare.net/paulyoungcga/fiscal-management-united-states-individual-states-
performance
• Pension crisis - https://www.slideshare.net/paulyoungcga/performance-of-pension-is-there-a-pension-crisis
• Provincial Govt - https://www.slideshare.net/paulyoungcga/fiscal-management-provinces-canada
• Chicago fiscal mess - https://www.chicagotribune.com/opinion/commentary/ct-opinion-mayor-lightfoot-budget-greising-
20190627-ucfjr2ye2fgarilf2jklcpqmo4-story.html
• San Francisco - https://www.bloomberg.com/news/articles/2019-12-17/san-francisco-faces-budget-gap-as-6-billion-can-t-
meet-costs
• NYC Fiscal Mess
• https://www.crainsnewyork.com/economy/report-new-york-sitting-debt-bomb - NYC Debt
• Deficits - https://nypost.com/2019/03/09/new-york-city-is-edging-toward-financial-disaster-experts-warn/ - NYC was already
running a deficit
• 2019 budget deficit - https://www.nydailynews.com/news/politics/nyc-faces-3-8b-budget-gap-2019-bigger-mayor-claim-article-
1.2648797

26. WOODGROVE
BANK
CANADA BOND RATING
26
Source – RBC and Fitch

27. WOODGROVE
BANK
BANKING SECTOR – RISK ANALYTICS(FINTECH)
27

28. WOODGROVE
BANK
CASH FLOW MANAGEMENT
28

29. WOODGROVE
BANK 29
SHENZHEN/ DEBT
Source - Moody's
• Tahoe Development defaults -
https://www.caixinglobal.com
/2020-07-08/drowning-in-
debt-property-developer-
tahoe-defaults-again-
101577286.html
• Default Debt Issues – China -
https://financialpost.com/pmn
/business-pmn/chinas-
corporate-debt-defaults-
uncover-hidden-soft-spots
• China growing corporate debt
defaults -
https://www.hindustantimes.c
om/business-news/china-s-
growing-dollar-bond-
defaults-reveal-depth-of-
stress/story-
onRQK2FExlIvGHB8AHbj
WI.html

30. WOODGROVE
BANK 30
BANKRUPTCIES
• 24 retailers and restaurant chains have filed for bankruptcy and liquidation -
https://www.businessinsider.com/retailers-filed-bankruptcy-liquidation-closing-
stores-2020-2
• Chapter 11 bankruptcies rose 26% for the first half of 2020
https://www.wsj.com/articles/chapter-11-business-bankruptcies-rose-26-in-first-half-
of-2020-11593722250
• Bankruptcies in the USA for June 2020 are up 43% from June 2019 -
https://nymag.com/intelligencer/2020/07/major-companies-filing-for-bankruptcy-due-
to-coronavirus.html
• IMF warns small to medium-size bankruptcies may tripe -
https://economictimes.indiatimes.com/small-biz/sme-sector/imf-warns-small-and-
mid-sized-business-bankruptcies-may-triple/articleshow/76992460.cms
• Mortgage issues - https://www.housingwire.com/articles/foreclosure-threat-grows-as-
covid-19-surges-fed-says/
• Housing market will face many issues over the next few years -
https://www.slideshare.net/paulyoungcga/latest-news-housing-canada-june-2020
• Changes in business operational model could lead to changes in commercial and
office - https://www.ibisworld.com/global/market-research-reports/global-
commercial-real-estate-industry/

31. WOODGROVE
BANK 31
CASH FLOW
• There are significant challenges facing many countries including job quality. Interest rates likely will rise slightly
- https://www.forbes.com/sites/alyyale/2020/08/06/mortgage-rates-hit-new-low-keeping-rising-home-prices-in-
check/#208edbd53674 . The issue will be more about wages due to job quality issues -
https://www.slideshare.net/paulyoungcga/average-wages-and-job-quality-canada
• USA continues to struggle with recovery from COVID19 including job quality related issues -
https://www.theguardian.com/business/2020/aug/07/us-jobs-unemployment-figures-covid-19
• Middle East and Africa - https://www.middleeastmonitor.com/20200812-mena-highest-youth-unemployment/
• OECD and Job Quality
Bottom line:
• If there are pressures on wages due to competitive pressures, sale drop, access to new markets, etc. this will
lead to employment issues
• Both government and the private sector are turning to more automation -
https://www.slideshare.net/paulyoungcga/technology-canada-and-the-world

32. WOODGROVE
BANK 32
SUSTAINABLE
REPORTING
Here is my work on sustainable reporting. There appears to be global movement by various accounting standards board
to bring a standardized framework for sustainable reporting -
https://ibm.box.com/s/vmyitcackqevvm1hcxv7wke6gudrpnce
Climate and Financial Risks
• On Jan. 25, the US Federal Reserve and European Central Bank simultaneously signaled their intent to make climate
considerations a central part of finance. Both say they will now analyze the risk climate poses to the stability of
individual banks, as well as the broader financial system. Source - https://qz.com/1962476/climate-risk-is-about-to-
reshape-wall-street/

33. WOODGROVE
BANK
EDUCATION AND PROFESSIONAL
DEVELOPMENT
• If you like to learn more about
trade and/or other subjects as
part of your professional
learning and development then
feel free to review my material
on https://www.udemy.com/
(search Paul Young CPA CGA

34. WOODGROVE
BANK
RISKS –
WHAT
NEEDS TO
HAPPEN
• Systemic issues with housing - https://www.slideshare.net/paulyoungcga/latest-
new-housing-market-canada-april-2020 or
https://www.slideshare.net/paulyoungcga/urban-and-rural-planning-whats-next-
236315321
• Restructuring of government - https://www.slideshare.net/paulyoungcga/canada-
and-provinces-fiscal-and-economic-management or
https://www.slideshare.net/paulyoungcga/canada-municipal-and-local-
government-whats-needs-to-be-done or
https://www.slideshare.net/paulyoungcga/how-to-reform-local-and-municipal-
government
• The new reality of economy post-covid will see many issues facing businesses -
https://www.slideshare.net/paulyoungcga/state-of-the-world-economy-june-2020
or https://www.slideshare.net/paulyoungcga/key-macro-and-micro-indicators-
canada-april-2020-and-may-2020
• Cheap Debt cannot last forever
• Sluggish economic growth - https://www.slideshare.net/paulyoungcga/what-is-
next-for-the-global-economy-january-2021
• Risks with GDP - https://www.slideshare.net/paulyoungcga/gdp-by-industry-
canada-june-2020 or https://www.slideshare.net/paulyoungcga/what-is-next-for-
the-global-economy-august-2020
• Corporate debt
https://www.forbes.com/sites/ezequielminaya/2020/06/16/indicator-points-toward-
slowdown-in-us-corporate-debt/#150a98cf43a5
• Restructuring of many businesses -
https://www.slideshare.net/paulyoungcga/canada-hospitality-sector-whats-next-
236439916 or https://www.slideshare.net/paulyoungcga/retail-sales-united-states-
may-2020
• Hike in mortgage or personal credit rates
• More consumer default
• Lower Credit rating for government
• Higher bond yields means higher interest rates and higher debt coverage