The Debt-Bomb Threat

After a decade of go-go lending, second thoughts about the risks

COVER STORY

After a decade of go-go lending, second thoughts about the risks

Never in history have so many nations owed so much money with so little promise of repayment. At stake is a gargantuan debt, a $706 billion lien held by banks, governments and international financial institutions around the world against a group of deeply troubled developing and East bloc countries. It is a sum nearly the size of the annual U.S. budget and more than three times that of Japan's; it is $154 for every man, woman and child on earth. It has mushroomed from about $...

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