Surviving a national debt spiral is a challenge for households, business, and the government. For households, a national debt spiral will manifest as the worst cost of living crisis in generations as monetary inflation reduces the purchasing power of the fiat currency. Fiat currencies that will experience the worst monetary inflation are those where global demand for the currency, either for global trade, international loans or bonds,...
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Public debt can be both a tailwind and a headwind on the economy, depending on the size of the debt to the size of the economy. Debt is manageable if it grows at a slower rate than economic growth. Public debt thresholds In countries where the public debt is below 60% of GDP, the debt has a positive impact on the economy. When the size of the public debt is between 60 and 90%, the effects are negligible. Public debt becomes a...
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