Debt and liquidity dearth could propel next crisis

SCARE stories are always popular. With the 10-year anniversary of the 2008 global financial crisis coming up, talk has resumed of where the next financial crisis will come from.

While some might prefer to worry about black swans and "unknown unknowns", disaster can have its roots in insufficient attention paid to existing problems.

One such issue is debt. Investors do not need to look far to get evidence of rising debt across the world. The sheer volume of borrowing in China's financial system in recent years has been much talked about. What is new in the past year is how consumer lending is accelerating. This is due to …