Why are growth prospects so low

Why are growth prospects so low? There is one key ingredient missing from the growth and deflation commentary and that is the state of global balance sheets. Other than isolated cases (namely US banks and US households) no group has truly unwound its debt excesses since 2009 - most countries have wasted the past five years trying to spend their way out of debt. It is not surprising that the economy with the highest growth prospects in 2015 (the US) is the one which has done the most balance sheet repair. In contrast, the weight of debt in other countries is holding down consumer spending in two ways; firstly household budgets are swamped by interest payments and rising costs of living and despite record low rates, and secondly rates are still too high to stimulate the marginal investor as the central bank leverage model is now exhausted and broken.