Comments by "gerhard7" (@gerhard7323) on "“We are in a debt trap” - Nouriel Roubini on 10 ‘megathreats’ to our world and how to stop them" video.

  1. More than a decade of low interest rates, though perceived by many as a good thing, were essentially maintained because our economies have been built upon rising asset price values, most particularly land and property. Assets purchased primarily through debt. Keeping the price of that debt affordable has been the tightrope that our central banks have been attempting to walk for years now. A toxic combination of covid, a worsening global trade situation, the Ukraine invasion and rising energy prices is likely the proverbial tide going out on this intensely fragile model. Might be time to see who is swimming naked....
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  2. Modern economies thrive on exponential debt creation and punting it further and further down the road the closer it becomes due. A large proportion of that debt is created off of apparently ever increasing property and land values. If belief in that debt-based model starts to fall apart then so will the economic fundamentals that support all this froth. The uncomfortable fact is is that, globally speaking, the economy has barely grown at all since the 1970s. What has changed exponentially is the size of the debt and the lengthening terms attached to that barely changed fundamental.
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  3. MMT is only feasible as long you have functioning REAL economies capable of absorbing most of that excessive 'Keynsian' money creation, but even that is time limited. Trending or entrenched low productivity and shrinking or stagnant economies will not do the job of lifting countries out the deepening debt mire.
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