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Biochemist
United States1008 Posts
![[image loading]](http://www.billjaquette.net/wp-content/uploads/2009/12/nationaldebtbygdp.gif) I've never had an economics class and from how fractured the field seems to be I probably shouldn't trust what I would learn in one anyway. Can someone explain to me how it's possible for virtually the entire world to be in debt at the same time, like broken down Barney style? Who is everyone borrowing from, if nobody has wealth to give?   | ||
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iamho
United States3347 Posts
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jalstar
United States8198 Posts
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Weasel-
Canada1556 Posts
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Biochemist
United States1008 Posts
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ieatkids5
United States4628 Posts
edit - well more could be said, but that's pretty much it. | ||
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GoodWill
Canada149 Posts
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Nightmarjoo
United States3360 Posts
I didn't know Japan was almost as in-debt as us though, what's going on there? | ||
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XinRan
United States530 Posts
On May 16 2010 16:53 Nightmarjoo wrote: Wow, Russia's pretty good at balancing their checkbook, only in debt $150 billion! I didn't know Japan was almost as in-debt as us though, what's going on there? I think it's years of stimulus spending to lift Japan out of the economic stagnation that started with the Asian financial crisis. Personally, I blame democracy for the world's debt woes. Cutting social entitlement programs that bankrupt countries will always be politically unpopular. | ||
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blue_arrow
1971 Posts
 , private investors and corporations are the ones doing most of the loaning =p | ||
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alexpnd
Canada1857 Posts
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Romantic
United States1844 Posts
On May 16 2010 17:01 XinRan wrote: I think it's years of stimulus spending to lift Japan out of the economic stagnation that started with the Asian financial crisis. Personally, I blame democracy for the world's debt woes. Cutting social entitlement programs that bankrupt countries will always be politically unpopular. Cutting your 700,000,000,000$+ dollar military budget, halting wars of aggression, and investing in education (Kids can't vote anyway! Psh) not tax cuts are also pretty unpopular. Not to mention ending state sponsored terrorism, torture, that sort of thing. | ||
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Nightmarjoo
United States3360 Posts
On May 16 2010 17:13 blue_arrow wrote: these are government/public debts obviously , private investors and corporations are the ones doing most of the loaning =pThat's a good point, and potentially a scary one. Not sure if I like the idea of private companies owning the gigantic debts of the entire world, that's a little too much bureaucratic power in the hands of people with virtually no accountability. Hard to regulate your lender, the guy who has you on his debt-leash. | ||
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nadafanboy42
Netherlands209 Posts
A big not often highlighted reason for the european bailout of greece is that a huge amount of the greek government debt is actuall owed to various banks in france germany etc., who would go bankrupt if several hundred billion euros of greek debt they hold suddenly became worthless. The key thing to undersand is that though governments has a lot of money, the total amount of money that goes on in the economy in the private sector is always like, ten times bigger, so that's where the money comes from. | ||
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Caller
Poland8075 Posts
i was severely disappointed. | ||
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Dr. Tran
United States125 Posts
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darmousseh
United States3437 Posts
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Naib
Hungary4904 Posts
We're world class in something, hooray! | ||
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leejas
United States440 Posts
In simple terms, if I understand the charts correctly.... GDP is a total of spending categories C- consumption (Thats basically us buying stuff...going to the supermarket, etc.) I - Investment (any spending meant to generate more stuff. This is a factory for a company or a house for a person, because people are counted as labor) G - Government (Anything the government buys as an entity) (X - N) = Exports minus imports Thus: GDP = C + I + G + (X-N) Now what the chart reflects is that the "redder" or higher percentage countries generate more national debt because they spend (and thus create) more money than they take in. All governments do this. More people means more money circulates, more goods, and more funds needed to run a country. (ie: 200$ can be exchanged between maybe a population of 5 people, but you need $200,000 to run a country of more ppl, etc.) Some people previously said it's loans from groups/investors, so it could be anything from loans from other countries to the country buying on credit. Whatever a country doesn't make up for in taxes it has to use with loans or credit. The picture depicts how much of a country's GDP is really based on loans or credits. TL;DR: GDP is how much stuff a country has made and used. The picture shows what percent of a country's GDP comes from governments spending money they borrow. | ||
Jibba
United States22883 Posts
On May 16 2010 17:01 XinRan wrote: I think it's years of stimulus spending to lift Japan out of the economic stagnation that started with the Asian financial crisis. Personally, I blame democracy for the world's debt woes. Cutting social entitlement programs that bankrupt countries will always be politically unpopular. Japanese financial crisis was independent of the Asian financial crisis. It's difficult to explain because macroeconomics is a shifty art. Macroeconomic predictions are like reading goat entrails, and about as accurate. | ||
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