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With the low availability of reliable assets doesn’t that mean that any government could issue like 2% bonds and essentially get near unlimited buyers? Thus fin

With the low availability of reliable assets doesn’t that mean that any government could issue like 2% bonds and essentially get near unlimited buyers? Thus financing huge projects like a complete transition to green energy, or large infrastructure projects and at the same time help work against the potential severity of a future crash?

samsonradu 7y ago
2%? They're issuing ~0% bonds in most of the Eurozone. I also believe there can't really be a crash when interest rates are very low/at 0%, since the time value of money literally becomes null and debt can forever be pushed further. BUT since there is already existing debt to service - issued at higher interest rates - the debt size has to increase. Then it works as a trap as the interest rates cannot easily go up without heavy defaults - because there is a lot of debt to service. Also, somehow low interest rates correlate with low GDP growth - max capacity, no room for growth left? Disclaimer - not an economist, perhaps someone can debunk my theory and explain what I'm getting wrong.