Around the globe, debt continues to grow, regularly creating cause
for concern. Are today’s economies really nothing but a house of
cards? The Covid-19 pandemic has not helped matters: the debt of
most Western governments has soared as a result. Nearly everywhere, the
boundaries put in place by circumspect European Treaties or resulting
from lessons learned from centuries of financial history (Reinhart & Rogoff,
2010) have clearly been breached. Will our governments go bankrupt? And
who will foot the bill?
This book aims to tackle these questions and clarify why, rather than
resign ourselves to ever-growing debt, we should seize the opportunities
debt can offer and strive to deal with related risks. While debt can indeed
be a catalyst for crisis, it is also crucial to economic growth, for the simple
reason that one person’s debt liability is another’s debt claim. When an
economy grows, households save and most of those savings lead to an
accumulation of debt investments. If nobody borrows, then nobody can set
money aside and the economy, as Keynes has shown, will stagnate or,
worse, contract. In a market economy, Aesop’s fable does not hold true: the
ants need the grasshoppers.

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