Where Will You Be When The Bubble Bursts?

A chilling essay from Forbes.

Main thesis below. Here's the link to the full text. Thanks to Jesse Colombo for not buying into our self-made hype.

While household debt levels are fairly low at 35 percent of GDP, Bangko Sentral ng Pilipinas, the Philippines’ central bank, has been using this as an excuse to encourage banks to lend even more aggressively to consumers and businesses in order to spur further rapid economic growth. 

Simply stated, the Philippines’ central bank is actually trying to inflate a credit bubble, which is very alarming and reminiscent of the pro-credit growth policies of the Greenspan Fed during the 2002 to 2007 credit bubble...

The Philippines’ bubble will most likely pop when China’s economic bubble pops and/or as global and local interest rates continue to rise, which are what caused the country’s credit and asset bubble in the first place. The resumption of the U.S. Federal Reserve’s QE taper plans may put pressure on the Philippines’ financial markets in the near future. Another global economic crisis (as I expect) also puts remittances at risk.