Been a while since this

Where are financial crises likely to arise next?First, it's important to understand that bank lending creates new credit and new debt in equal measure, by keystroke entry in double-entry spreadsheets. The British and German central banks have both published papers and videos in recent years explaining how this works. Banks don't on-lend deposits they take in from depositors. Banks create money — and debt  — whenever they extend credit to a client, whether it's by means of credit cards, mortgages, or business loans.In most countries, the bulk of credit creation is mortgage lending. And when bigger and bigger mortgage loans are made in an environment of fast increases in house prices, i.e. in countries or cities where there's a major real estate bubble inflating, like Sydney in Australia or Vancouver in Canada, you get bigger and bigger private debt mountains.When real estate prices stop rising, banks reduce the scope of their mortgage lending, and debtors start trying to pay down their debts. They cut back all their other expenditures and focus on trying to keep up with their monthly debt obligations. This causes an economic slowdown, reducing incomes further, and so on, in a self-reinforcing spiral. This is how financial crises arise. Mortgage overlending and real-estate bubbles, in particular, are very often the main cause. So, look for crises to happen in any country which has excessive private debt, and especially countries which have big mortgage bubbles that are nearing their peak, but have no big trade surpluses in their favor to offset the growing domestic debt burden. An environment of low commodity prices combined with already-inflated real estate bubbles is a nasty combination, and both Australia and Canada are at risk for that reason.