Ignore Debt at Your Peril

Economic stability is often viewed as a distant goal.

Many believe that simply managing government debt will suffice.

This is a dangerous misconception.

Ignoring private debt levels is like ignoring a ticking time bomb.

When households are over-leveraged, they can’t spend.

This leads to reduced demand, which spirals into economic downturns.

The Great Depression is a prime example.

As private debt soared, spending plummeted.

The more people tried to pay off their debts, the more they owed.

This is Fisher’s Paradox in action.

Instead, we should focus on reducing household debt.

This means creating policies that encourage responsible borrowing.

Democratizing share ownership is another crucial step.

Imagine a world where everyone has a stake in the economy.

When people feel invested, they spend more.

This boosts demand and stabilizes the economy.

Relying solely on mainstream economic models is another pitfall.

These models often overlook the complexities of real-world economies.

They treat the economy like a simple machine.

But economies are living systems, full of unpredictable interactions.

Government intervention plays a vital role.

Think of it as a safety net.

When the economy falters, government spending can stabilize it.

The COVID-19 pandemic showed us this.

Direct financial support to households led to a quick recovery.

In contrast, the Great Recession dragged on due to lackluster government action.

The lesson is clear: we need a new economic paradigm.

One that prioritizes stability over outdated beliefs.

Only then can we hope to build a resilient economy.

[StrixTechnica]

I expect you're right, but a static video of your own tweet without further commentary is disappointingly low effort. also, shorts are a terrible medium to communicate this sort of material.

[adenwellsmith]

So why are you ignoring the big debts? Pensions