One's debt is other's asset. In my understanding, such large ratio of debt to GDP means that the world's economic system is highly interconnected without enough slack in it, which increases risks of avalanche effects. Meaning that someone's failure to service his debt with increasing probability will cause a ripple effect of bankruptcies throughout the system.
Note that this view does not include the existence of the money printing press, which currently runs at full throttle. In theory it would mean destruction of the debt via inflation (i.e. debt yield will be smaller than inflation), thus preventing the avalanche effect, but this approach is by no means a free lunch.
Note that this view does not include the existence of the money printing press, which currently runs at full throttle. In theory it would mean destruction of the debt via inflation (i.e. debt yield will be smaller than inflation), thus preventing the avalanche effect, but this approach is by no means a free lunch.