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originally posted by: Ove38
originally posted by: ScepticScot
originally posted by: Ove38
originally posted by: ScepticScot
a reply to: Ove38
Why would 105% be bad? On its own debt to GDP is a meaningless measure.
Somalia has a lower debt to GDP ratio, does it have a better economy?
A low debt-to-GDP ratio indicates an economy that produces and sells goods and services sufficient to pay back debts without incurring further debt. That's why 105,27 % is bad.
No it doesn't. For a country with its own currency a higher or lower Debt/GDP ratio is neither a good nor a bad thing.
A country paying back its nominal debt with zero % growth & high unemployment would be reducing the the debt/GDP ratio but it would not be in most peoples opinion doing well.
A nations debt is just the accumulation of the deficits it runs over time. Deficits are neither inherently good or bad. If a economy needs stimulated then running a deficit is entirely the correct thing to do.
So USA will become Greece at $24 trillion debt is wrong ?