The bursting of the housing bubble in 2008 plunged the U.S. economy into a serious crisis, leaving American households with a huge debt overhang and the economy with a large gap in output and employment. This report reviews the economy’s deleveraging and recovery experience more than five years after the crash. It explores the following questions:
- How far has the economy come in the deleveraging process? Is private sector debt now at a sustainable level or do households and the financial sector continue to need to pay down debt?
- To what extent has the U.S.