Developed economies around the world are loaded up with debt. That was less of a problem in the era of free money but inflationary pressures are back and structurally-higher interest rates mean debt is more expensive to issue and service. Many investors have been warning that governments are addicted to debt for the past 20 years and the alarm bells are growing louder. This film examines what some are calling the biggest issue in global finance today, the role of the ‘bond vigilantes’, and whether government borrowing could spiral out of control.
#markets #debt #borrowing #déficit #bonds #trading #investment #finance #investors #japan #us #donaldtrump #elonmusk #doge #uk #liztruss #rachelreeves #germany #friedrichmerz #china #italy #france #yields #bondvigilantes #bondmarket
00:00 Introduction
01:05 Why the world is ‘addicted’ to debt
03:27 Government bonds explained
04:11 The debt ‘death spiral”
06:18 Where does the deficit go?
07:47 Inflationary pressures
09:59 Return of the ‘bond vigilantes’
11:03 The UK’s Liz Truss moment
12:39 America’s unsustainable debt profiles
17:32 Japan’s debt and its determined central bank
18:54 China’s ‘staggering’ debt levels
19:50 Italy, France and Germany
22:49 A risk of a financial market ‘heart attack’
24:51 Deficits ‘can be useful’
27:12 The future
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Citizens around the world must learn not to live beyond their means
Because they refuse to tax the rich appropriately. Didn't need to make a 30 minute video about it
The feral overclass are addicted to unfunded tax cuts and to freeloading off the rest of society. Make the rich pay their share — by force if we must. Simple.
debt isnt a bad thing when used for investments in the future or deal with crisis but one cannot fund welfare with debt sadly. Welfare needs to exist and be supported . it does great good in the world; however countries need to grow their economies cut spending probably on defense or raise taxes. This is because they didn't save when they were doing well to make up for current times when deficit spending is necessary.
All analysis seem to ignore (perhaps intentionally) that the financial system, as exists today, is a make believe game. There are few (many times none at all) assets to back up most/all products/transactions. In 2008, we had a bitter taste of what the uncontrolled use of that make believe system and products can cause. In the end, all was wiped out with more make believe money (tax-payers took the debt saving the creators of the crisis who ended up even richer) but the lack of back-up assets remain in place. All this make believe game can be reset at anytime. The players who hold the most monopoly money of course have control over society, politics, production systems, Media, etc., and do not want to allow that to happen. All those tools are used to keep the vicious cycle going in their favor and scary tactics, cruel and irresponsible government acts/decisions are justified. Education is increasingly left to elites and talked down by the manipulators. See who we have been electing, the negation of proved science that has increased lifespan and quality of life (i.e.: Vaccines), the denial of human activity in Climate Change (despite documentation from polluters being uncovered and confirming the fact they know what they are doing and the consequences to health and planet)… I can go on for hours but I assume people watching this video can see the point and all else I am omitting. We have had a Industrial Revolution, a Technological Revolution… We are in desperate need of a Human Revolution, that will reshape how we see society, how we create and distribute goods and services, how we enable economic activity in sustainable ways creating prosperity and riches but with social responsibility and environmental respect because we'd know the consequences of the old ways (what we are living through now).
Note: At 24:11, Russell Napier mentioned one of the solutions. That has been done in the past and society continued.
Honestly, I don't think there's much to be learned from this video. Just soundbites from various different "experts", often disagreeing with each other.
Just print more money. Savers are going to pay for the cost. Debters are the ones to win, including the governments. It's going to be the biggest reverse Robinhood but it the debt problem gets a reset.
Glizzy glizzy glizzy
I would dispute a comment that was made perhaps half way through the video, something to the effect, "The United States is the most important country in the world, the U.S. dollar is the most important currency…" The second part is true, the first part is untrue. There is no world leader anymore, and we were lucky to have any kind of world leader at all after the Cold War's end. There are no true leaders in the world right now as self-interest, stupidity and greed are not leadership qualities. Perhaps the European nations will step up, it can be argued they owe the rest of the world for the world wars etc.
y'all really don't like Trump, got it
You can’t pay debt? I will take your country.
Why anyone would trust trump to not default?
Real question is who holds all the credit? And what is the distribution. Nothing wrong with goverment spending
diplomatic negotiations to stimulate economies with lower inflation and stronger currencies purchasing power from higher interest rates by reducing debt through 20% taritfs, invome tax, property tax
lol we could tax the wealthy to help pay down the debt since many of them are the ones collecting the revenues on the government debt payments. But nah why discuss that. Where are these surpluses going? To the very wealthy.
16:32 someone from the IMF talking about responsibility, that’s laughable. An entity created just to run countries into foreign debt to force them to adopt the neoliberal agenda. Neoclassical economists have no shame really.
After the backlash against austerity post-2008, is there any public appetite for spendin cuts today?
If growth remains weak, can governments afford not to borrow to avoid social unrest?
19:20 bro thinks China's tax is "staggering" while being from USA??? WTAF ????????????????????????
Clinton put the US on a course for yearly surpluses and to fully pay off the national debt. Then GWB gave out huge tax cuts to the rich and fucked that all up.
its because politicians are some of the dumbest most selfish people in our society, and over time it has made government entirely corrupt
It's not that they're addicted to debt, it's that they can't get elected if they say they will raise taxes. Raising taxes is the way to clear debt. Governments have debt because they spent more money than they collected in taxes. It is that simple. Basic levels of tax need to be made constitutional so that political parties can't keep undercutting each other on tax and ruining the country in the long term by borrowing from future generations.
When it comes to developed nations: Because they refuse to raise taxes on those with wealth to a point which covers necessary state spending. So they borrow money from rich people and their institutions instead of taking it from them. Which means that at the end of the day the rich actually profit from lending money to governments, in the form of interest, which basically gives them a rebate on the taxes they do actually pay, and at the end of the day they end up contributing very little.
China "hasn't been growing" for the past 50 years. I think they're doing just fine.
They are addicted to spending Debt is the consequence of deficit spending
National debt is a measure of all predecessor regimes' cumulative deficit spending
Largely superficial and emotional discussion of issue. Large government debts can be responsibly managed; japan is an example. In the US, Trump's reckless policies and conduct are the problem not the federal government's debt. I expect better analysis from FT.