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Every time I read news like this, I wonder where all that money is coming from? As far as I know, Japan is one of the most indebted countries out there. Look at

Every time I read news like this, I wonder where all that money is coming from? As far as I know, Japan is one of the most indebted countries out there. Look at the USA too, they've printed like 2 trillion dollars during this crisis, my own country has a dept of around 50% of its GDP. I feel like most countries have not intention of paying their debt ever, the politicians are just kicking the can down the road until one day all this explodes and all this debt is forgotten, maybe? There's probably something I'm missing since I am not an economist.

ducttapecrown 6y ago
The debt of a country is completely different from the debt of a person or a company. Basically the difference is that countries can print money, but what it means is that large amounts of debt are okay and even desirable. The U.S. in particular is in an even safer spot because the dollar is the world reserve currency. The debt of the worlds countries will explode if and only if money goes to hell. I'm not an expert, so I'd encourage you to do some your own research.
csomar 6y ago
> There's probably something I'm missing since I am not an economist. What you are missing is that these countries are leveraging their positions as reserve currencies both for global corporations and also other countries. This crisis strongly benefited the USD, EUR and JPY. The demand for these currencies (especially the USD) is in the trillions. In the unfortunate event that the European Union is dissolved and countries like Italy/Spain decides to switch to their own, most people/companies holding EUR will decide to switch to ... probably USD/JPY as they don't really trust their home currencies much. That's why the U.S. has an (or multiple) air carrier around the world to project power.
zemnmez 6y ago
being in debt as a country is very different to being in debt as an individual as a country's expenditure directly correlate to its earnings. in this sense, it's unwise for a country to 'save' in the same way individuals do -- since, for example in this case if small businesses collapse causing their workers to spend less (or nothing at all) the decrease in economic activity will lower tax income to the country itself. when it comes to the US injecting 2 trillion dollars, that's from quantitative easing which is not 'borrowed', it's just generated by the central bank of the country directly to increase liquidity. it's similar to a stock split, but for a country. The total 'value' in the economy stays the same, but the additional liquidity creates an increase in economic activity for some time which may allow investors to switch investments from short to longer term. I've seen a lot of people online who think the US had $2T lying around somewhere but it's quite the opposite. slightly unrelated to your comment particularly but -- I wish the analysis of governments being able to spend like this from the average person wasn't either 'governments are going more into debt than they should' or 'governments have money but don't use it on their people', but 'governments have access to spending powers that individuals do not, which can massively benefit an economy in the way no other entity's spending can'.

ducttapecrown 6y ago

The debt of a country is completely different from the debt of a person or a company. Basically the difference is that countries can print money, but what it means is that large amounts of debt are okay and even desirable. The U.S. in particular is in an even safer spot because the dollar is the world reserve currency. The debt of the worlds countries will explode if and only if money goes to hell. I'm not an expert, so I'd encourage you to do some your own research.

csomar 6y ago

> There's probably something I'm missing since I am not an economist. What you are missing is that these countries are leveraging their positions as reserve currencies both for global corporations and also other countries. This crisis strongly benefited the USD, EUR and JPY. The demand for these currencies (especially the USD) is in the trillions. In the unfortunate event that the European Union is dissolved and countries like Italy/Spain decides to switch to their own, most people/companies holding EUR will decide to switch to ... probably USD/JPY as they don't really trust their home currencies much. That's why the U.S. has an (or multiple) air carrier around the world to project power.

zemnmez 6y ago

being in debt as a country is very different to being in debt as an individual as a country's expenditure directly correlate to its earnings. in this sense, it's unwise for a country to 'save' in the same way individuals do -- since, for example in this case if small businesses collapse causing their workers to spend less (or nothing at all) the decrease in economic activity will lower tax income to the country itself. when it comes to the US injecting 2 trillion dollars, that's from quantitative easing which is not 'borrowed', it's just generated by the central bank of the country directly to increase liquidity. it's similar to a stock split, but for a country. The total 'value' in the economy stays the same, but the additional liquidity creates an increase in economic activity for some time which may allow investors to switch investments from short to longer term. I've seen a lot of people online who think the US had $2T lying around somewhere but it's quite the opposite. slightly unrelated to your comment particularly but -- I wish the analysis of governments being able to spend like this from the average person wasn't either 'governments are going more into debt than they should' or 'governments have money but don't use it on their people', but 'governments have access to spending powers that individuals do not, which can massively benefit an economy in the way no other entity's spending can'.