Ratio
in sentence
1146 examples of Ratio in a sentence
So it is possible to reduce deficits and keep the debt/GDP
ratio
in check – provided that the economy does not start out with large imbalances, and that the financial system is working properly.
Economists like to point out that solvency has little to do with the
ratio
of public debt to today’s GDP, and much to do with debt relative to expected future tax revenues.
A government’s solvency thus depends much more on long-term growth prospects than on the current debt/GDP
ratio.
A reduction in the deficit today might lead in the short run to a fall in GDP that is larger than the cut in the deficit (if the so-called multiplier is larger than one), which would cause the debt/GDP
ratio
to rise.
Austerity should thus always be beneficial for solvency in the long run, even if the debt/GDP
ratio
deteriorates in the short run.
Thus, the key variable for countries that had large current-account deficits, and thus are burdened today with high foreign-debt levels, is not the debt/GDP ratio, but the foreign debt/exports
ratio
(together with the growth prospects for exports).
For example, for Spain and Portugal, the sum of past deficits relative to annual exports reached 300% and 400%, respectively, in 2009, whereas a 250%
ratio
is typically regarded as the threshold at which external-financing problems can arise.
Indeed, according to the IMF, Spain should record growing current-account surpluses over the next five years, as exports rise strongly, thus cutting the external debt/export
ratio
by half (to about 150% in 2018), while Portugal’s
ratio
should fall to about 250%.
Unfortunately, none of the net reduction in the US unemployment rate over the past year came from increases in the employment-to-population ratio; all of it came from declining labor-force participation.
Unemployment has fallen from 10.1% over the course of the past 18 months, but the employment-to-population
ratio
has remained stuck at 58.4%.
If you take that view, between 1950 and 1990, the US employment-to-population
ratio
would rise an extra 0.227% annually on average for each year that the unemployment rate was above its natural rate.
If the US employment-to-population
ratio
had started to follow such a path after its 2009 peak, the current
ratio
would be 59.7%, rather than 58.4%.
The price-to-GDP
ratio
of GDP-linked bonds is essentially analogous to the price-to-earnings
ratio
of corporate shares.
Following January's disappointing macroeconomic data, the PBOC acted again, by lowering the reserve
ratio
for banks by 50 basis points, with additional cuts for banks focused on small and medium-size enterprises (50 basis points) and for the Agricultural Development Bank of China (400 basis points).
The new paper opens a different path: it suggests revising and harmonizing national accounting, in order to gauge better the vulnerability of eurozone members’ public finances; ensuring that banks’ creditors, rather than governments, pay when crisis strikes; decentralizing fiscal discipline by requiring each country to adopt a constitutional rule on the stability of the debt ratio; and curbing countries’ contingent liabilities by adjusting pension systems to demographic ageing.
Equity prices, as measured by the price-earnings
ratio
of the S&P 500 stocks, are now nearly 60% above their historical average.
The advantage of such bonds is that in the event of a decline in the world price of the underlying commodity, the debt-to-export
ratio
need not rise.
Brazil's debt to GDP
ratio
is moderate--better than in the US at the time Bill Clinton became president, far better than that of Japan and several European countries.
Consider China’s high leverage ratio, which many argue will be a key factor in causing a crisis.
While China’s debt/GDP
ratio
is very high, the same is true in many successful East Asian economies, such as Taiwan, Singapore, South Korea, Thailand, and Malaysia.
Ceteris paribus, the higher the saving rate, the less likely it is that a high debt/GDP
ratio
will trigger a financial crisis.
In fact, China’s high debt/GDP
ratio
is, to a large extent, a result of its simultaneously high saving and investment rates.
And, while the inability to repay loans can contribute to a high debt burden, the nonperforming-loan (NPL)
ratio
for China’s major banks stands at less than 1%.
If, based on these considerations, one concludes that China’s debt/GDP
ratio
does constitute a substantial threat to its financial stability, there remains the question of whether a crisis is likely to occur.
Even an economy with an overall budget deficit will have a declining government debt/GDP
ratio
if the growth rate of its nominal GDP exceeds that of its debt.
For Greece, with an overall deficit of 4.1% of GDP and a debt/GDP
ratio
of 170%, the debt
ratio
would fall if the combination of inflation and real (inflation-adjusted) GDP growth exceeded 2.4%.
In addition to the tough new regime of personal accountability, the commission would supplement the Basel standards on bank capital with a tight leverage
ratio.
By raising the denominator of the debt/GDP ratio, it enhances confidence in debt sustainability.
This makes it the best investment the world could make, reaping social benefits that outweigh the costs by 40 to 1.Similarly, providing micronutrients missing from more than half the world’s diet would reduce diseases caused by deficiencies of iron, zinc, iodine, and Vitamin A with an exceptionally high
ratio
of benefits to cost.
Romney’s fiscal plan thus reduces deficits sufficiently to decrease the debt-to-GDP
ratio.
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