posted on Jun, 29 2011 @ 08:09 PM
But thats how it works, investors all over the world buy bonds which governments sell in order to raise capital.
One cannot state that those bonds should stay inside the borders.
The growth they so desperately want is GDP, the more money flows round, the more revenue it generates, revenue that is needed for their budget.
Governments spend money and if the revenue is insufficient, they will have a deficit, if the revenue is enough or more than enough, a sound budget, or
even a surplus which can be used for reducing state debt, or lower taxes ect.
If money is needed, (running a deficit) they raise capital to close the gap on their budget.
The real lesson is that we cannot continue to spend more money than we earn, also that cheap money (low or no interest) creates bubbles that will
We have seen that in the last decade, in housing.
Another thing to learn is that bankers are sharks who sell products that will benefit them and not us.