Greece is reaching a stage where it is on the verge of reneging on its loan commitments to the EU. strangely enough because its people in a democratic election have voted against the anti-austerity measures imposed on it in the wake of its bankruptcy by its creditors the EU mainly led by Germany. greece is actually the tip of debt iceberg which engulfing the world both economies and also individuals. debt is actually ravaging the world tearing it asunder with its baleful influence. debt is more of a means to an end. the end is living the good life with all the toys of modern life and technology. the debilitating malaise has insidiously affected the very entrails of individuals, families, nations, societies and the entire globe.
this cancer of debt has pervaded all the pores and glands of our body politic. there is simply no cure no chemotherapy no radiation for cleansing us of this intoxicating pleasure cancer. all the so called addictive trappings of modern life like fast cars, energy intensive big gadget filled houses, multi internet devices, jet travel, infinite foods alcohol drugs, multidimensional entertainment, et al have a price tag and have fueled the crises - financial, environmental, psychological and physical both the individual level and society.
now what has happened as a result of this heady over leveraged existence entire nations and individuals are mired in deep debt from which they are not able to extricate themselves as they do not have the moral strength. discipline or willpower to practise some degree of austerity, lowering of standards of living, going back to basics, simple living or cost reduction. everyone engulfed in a massive debt trap bubble which is ever expanding like the universe dangerously hovering over the dark holes of space on the verge of been sucked into the interstellar interstices leading to TMAs a la 2001 a space odyssey.
this burgeoning debt has become endemic. nations, people and companies are living perpetually in the future. most businesses are including successful startups are living off the future with perpetual funding from banks, private equity, VCs. similarly economies are living on life support systems of ICUs, euphemistically termed as stimulus especially the developed ones like Japan, US and Europe. some countries like US have run up massive deficits of $ 18 trillion and still counting. most high debt economies have reach the state where fresh loans are issued to pay back interest of earlier loans and principal amounts are not repaid. time comes when even they start defaulting on interest repayments.
national debts are mainly sourced from deficits run by country's fiscal budgets, printing more money and increasing money supply, issuing internal bonds which are bought by banks which reflect these as part of their investment portfolios and reserve requirements, external borrowings by issuing international bonds to other countries and international financial institutions. defaults in debt repayments could result in weakening domestic banks, negative interest rates, increase in inflation, adverse currency fluctuations, downgrading of credit ratings, fall in imports, possible rise of exports, outflow of currency, weakening of economy, sharp rise in prices of essentials, economic unrest, interest rates declining and fall in GDP growth rate.
in a macro sense, today most of the global economies are living on the future ie perpetual loans which will never be repaid in the future. a gradual descent into global bankruptcy. a new paradigm will emerge where all govts will renege on loans, evergreen loans to 2050 ie shifting the denouement to a distant future when most of the people above 40 may not be there. in real term a much smaller amount will be something which conveniently dealt with then. new financial shenanigans which we need not worry are heads off today. a new time...a new age...new solutions....in the long run we are all dead as Keynes had said.
this cancer of debt has pervaded all the pores and glands of our body politic. there is simply no cure no chemotherapy no radiation for cleansing us of this intoxicating pleasure cancer. all the so called addictive trappings of modern life like fast cars, energy intensive big gadget filled houses, multi internet devices, jet travel, infinite foods alcohol drugs, multidimensional entertainment, et al have a price tag and have fueled the crises - financial, environmental, psychological and physical both the individual level and society.
now what has happened as a result of this heady over leveraged existence entire nations and individuals are mired in deep debt from which they are not able to extricate themselves as they do not have the moral strength. discipline or willpower to practise some degree of austerity, lowering of standards of living, going back to basics, simple living or cost reduction. everyone engulfed in a massive debt trap bubble which is ever expanding like the universe dangerously hovering over the dark holes of space on the verge of been sucked into the interstellar interstices leading to TMAs a la 2001 a space odyssey.
this burgeoning debt has become endemic. nations, people and companies are living perpetually in the future. most businesses are including successful startups are living off the future with perpetual funding from banks, private equity, VCs. similarly economies are living on life support systems of ICUs, euphemistically termed as stimulus especially the developed ones like Japan, US and Europe. some countries like US have run up massive deficits of $ 18 trillion and still counting. most high debt economies have reach the state where fresh loans are issued to pay back interest of earlier loans and principal amounts are not repaid. time comes when even they start defaulting on interest repayments.
national debts are mainly sourced from deficits run by country's fiscal budgets, printing more money and increasing money supply, issuing internal bonds which are bought by banks which reflect these as part of their investment portfolios and reserve requirements, external borrowings by issuing international bonds to other countries and international financial institutions. defaults in debt repayments could result in weakening domestic banks, negative interest rates, increase in inflation, adverse currency fluctuations, downgrading of credit ratings, fall in imports, possible rise of exports, outflow of currency, weakening of economy, sharp rise in prices of essentials, economic unrest, interest rates declining and fall in GDP growth rate.
in a macro sense, today most of the global economies are living on the future ie perpetual loans which will never be repaid in the future. a gradual descent into global bankruptcy. a new paradigm will emerge where all govts will renege on loans, evergreen loans to 2050 ie shifting the denouement to a distant future when most of the people above 40 may not be there. in real term a much smaller amount will be something which conveniently dealt with then. new financial shenanigans which we need not worry are heads off today. a new time...a new age...new solutions....in the long run we are all dead as Keynes had said.
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