[johnm1019]

Wouldn't this only sap the global economy if all those bad loans were backed by average Joes, who were then hurt by the loss of return? If instead they were backed by governments and multi-national conglomerates who already had hoardes of (free?) cash, then the effect on the economy would be limited.

[simonh]

Loans are 'non performing' precisely because whoever borrowed the money cannot pay it all back, or even keep up with scheduled repayments. Generally that's businesses, though they may be government owned. The article does discuss this issue and the problems with the different methods of dealing with it.