New Zealand households' net financial wealth (deposits, shares, unit trusts, pension funds, etc less household debt) is estimated to be only around 70 per cent of our annual disposable income. In the bigger developed countries, that ratio averages around 270 per cent - even after the fall in international share prices last year.
Even allowing for the inevitable problems in putting together such cross-country comparisons, and for the possibility that international share prices still have some further adjustment to do, that is a large - and sobering - difference. Put another way, the debt of the household sector in New Zealand is very much higher, relative to the sector's financial assets, than in many other developed countries.