Despite everything we hear about the Government's strong fiscal position and its ability to borrow through this crisis, New Zealand remains a heavily indebted nation.
The problem, and the risks, lie with our private debt.
Soaring houses prices lifted mortgage debt to eye-watering levels in the past decade.
So too the dairy boom saw agricultural land prices rise and concerns about farm debt grow.
Both were areas of concern before the Covid-19 crisis.
Now the Reserve Bank (RBNZ) warns we can add business debt levels to the list or worries.
The RBNZ yesterday highlighted issues for the commercial property sector and other sectors directly affected by Covid-19.
Commercial property – especially accommodation, hospitality, retail, and some office properties – accounts for around $40 billion, or 8 per cent of total bank lending.
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But for all that the latest RBNZ Financial Stability Report was broadly reassuring about the ability of our banks to cope.
It expects they can afford to keep lending through the downturn.
That's good news because now is not the time for Kiwis to panic and put wallets away with a view to industriously paying down debt.
The past few years were the time for that and thankfully we did make some small progress - at least reducing the rate at which debt levels were rising.
The RBNZ now describes the New Zealand financial system as "well positioned" to weather the Covid-19 pandemic with good "capital and liquidity buffers."
In fact it estimates that unemployment would have to rise by 18 per cent and house prices would have to plunge by almost 50 per cent before New Zealand's banks would require radical action like new capital raising.
But the RBNZ doesn't sugarcoat the damage the pandemic will do to our economy.
It is projecting a sharp decline of 10 per cent for annual GDP in 2020 - the largest fall in at least 160 years.
The associated losses in income will cause financial distress for a significant number of households and businesses, it says.
"Households face income shocks through two key channels: An increase in unemployment from redundancies and business failures in sectors most directly affected by Covid-19; and reductions in pay as firms across a range of sectors look to offset pressures they face during the period of reduced revenue."
So what next?
For better or for worse, rates of bank lending look set to fall.
As optimistic as the RBNZ is about the long-term health of the banks, the immediate prospect of lower profits will result in more conservative behaviour.
House prices are also expected to dip by as much as 10 per cent, so the amount people need to borrow should also fall - or at least rise less slowly.
That means some rebalancing of private debt levels - as we saw after the global financial crisis (GFC) - is inevitable.
We should be thankful that rebalancing looks likely to be an orderly affair, supported by both monetary and fiscal policy.
That will hopefully allow those who don't lose their jobs, or see their businesses fail, to keep spending and provide the economy with some much-needed stimulus.