like to talk about the struggle against covid-19 as a war. Mostly this is a figure of speech, but in one respect they are right. Public borrowing in the rich world is set to soar to levels last seen amid the rubble and smoke of 1945. As the economy falls into ruins, governments are writing millions of cheques to households and firms in order to help them survive lockdowns. At the same time, with factories, shops and offices shut, tax revenues are collapsing.
Few subjects in economics attract more scaremongering than government borrowing. The national-debt clock ticking near Times Square in New York has warned of imminent fiscal Armageddon since 1989. In fact a country’s public debt is not like a household’s credit-card balance. When the national debt is owned by its citizens, a country in effect owes money to itself. Debt may be high, but what matters is the cost of servicing it and, as long as interest rates are low, this is still cheap.
Governments will thus have to walk a treacherous path between stimulus today and prudence tomorrow. Success is not guaranteed. After the second world war countries shrank their debts over the course of decades, but only by using a bossy combination of high taxes on capital, financial repression and inflation, which erodes the real value of debts over time. A baby boom and rapidly rising levels of education made it easier for economies to grow their way out of debt.
Faced with this daunting reality, rich-world governments will make a big mistake if they succumb to premature and excessive worries about budgets. While they are in the throes of the pandemic, the withdrawal of emergency support would be self-defeating.
Kipsizoo
$BYND +24% BeyondMeat
Sisyphus.
Perhaps it it will hinder wars, no money left.
AudreyGarden It should burden the billionaires for years to come
MalcolmNance In between the disease and the debt is the money grab.
MalcolmNance Lets just do what Republicans do in America and ignore it and say it doesn't matter whenever its size is inconvenient.
MalcolmNance We may have come up with the Myth of Sisyphus, but I'm sure we'll figure a way to offshore the actual lifting.
MalcolmNance Good thing the GOP gave billionaire$ a $2 Trillion tax cut they didn't need, huh?
debts will never be paid ever
Lots of talk about debt. In Australia it's going to be bigger than Texas and Ben Hur combined. But who are the creditors? Who's winning?
Kiss goodbye to the roaring 20s. This decade is going to be bleak for many millions. 🤔
No. It will only burden Democratic presidents.
It’s just money. Mint a platinum coin as offset and move on. Economics is an art form used to enforce social stratification anyway, it’s not natural law.
Why pay anything back.. no need. MMT is here.
So what? They'll just print more of the useless stuff. Now is precisely the time to introduce an Earth Standard Currency.
Why not say first-world?
Unless the robots pay it off.
Hahaha you said that back in 2007-2008 and you were so wrong than. Why should we believe you now?
While the disease is pandemic, the debt is designed!
Just a thought, why can’t I just buy this article to read for $2, instead of subscribing
Alternative title: « AFTER THE DISEASE, THE DEATH! ». Choose the appropriate one😷😷😷
It was/is the DEBT all along...with or without any disease. The DEBT is and of itself the disease.
Yawn
Corona-Sysiphe.
Sisyphus
WTF do you mean 'after.' During. Now. Ask any hospital, restaurant or retail shop. Maybe you meant 'the financial avalanche.'
now that's a good headline
this is rambutan?
I CAN SEE NIGERIA WRITTEN ALL OVER THIS TWEET😭😭😭😭 MY COUNTRY IS A FUCKING JOME
Give the bill to the robots.
The virus is the excuse to print money without causing massive resistance from unhappy citizens.
and to cope with trajectory of death tolls.
😂 We trade a downturn now with a disaster in the future...
CRISIS 2018 to 2028 .
Trump will cut taxes so the debt grows even more. As nobody seems to care.
Americans can’t control their debt. Cost of living in some states is over the top. They need government support to survive during the pandemic. Lenders still continue to profit
“Across the rich world, IMF says gross government debt will rise by $6trn, to $66trn at the end of this year” The problem is not coronavirus' debt, but how $60trn of sustainable borrowing capacity was consumed for other much less important things. 😡
for Ch8na
sizin öneriniz?
Just for today I shall live through this day only.
TRUMP PUTS AMERICA FIRST!! This is why the Democrats hate him! DONATE Bitcoin to Trump campaign! Let the whole world see how massive we are!! Wallet address : 1L7FGmrW1Ykc8KTsBF2SQVXemTY9bgcsjL
Who do they owe that money to? Who controls the money is where the finger of blame for COVID19 society lockdowns shall be pointed.
Government debt is not the problem but the private sector debt. Only problem with Govt debt is that who ends up benefiting & as long as 100% benefit Govt debt is fine (as it means investment by the private sector).
Green New Deal. Jobs guarantee.
What's the big deal? Corporate bailout debt never seems to be a problem.
Debt? The G7 will have a collective right off. Yet Africa will set back a 100 years
Default on it. Move off the fiat currency based on petro dollars and back onto the gold standard .
According to the childish government of Spain with antifascism
God help the everyday American after all this is over. We will be taxed to death. OMG!
Like they always do. The Federal Reserve will print money. It’s called QE, they will buy T-bills.
this is why states need to prepare themselves for disasters
The Greek democracy figured out jubilee before Christ. Christ.
Do you mean how much tax increase the population will face to pay for it all?
Relax it’s called inflation. It’s capitalism’s little safety valve. If you own tangible objects, commodities, stocks, land, you’re golden. All of these people calling for endless printing get ready for the party. coronaconomy
TrumpIsALaughingStock
Governments change the people get the debt.
By spreading repayments over generations and not imposing austerity measures to balance the books in the short to medium term
🇧🇷💥
Maybe, just maybe, we could try raising taxes on the wealthy and corporations for a change.
This is a joke, debt, as money per se, does not exist. This is a f*ING crisis. People just need to support each other.
The burden of Debt for who ? GUESS :
Wages and GDP growth is going to suffer. How else we can come up apart from negative interest and higher growth.
collam1020 Reserve Bank eyes removal of LoantovalueRatio mortgage restrictions in response to COVID-19 EconomicDownturn for at least a year
That's what we should be concentrating on One way is to have China pay for all the losses here and all over the world?
Who gives a shit
Really? Isn't it serviced in the same way as all government spending? And surely the payments are just another form of stimulus?
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