If I, as a microcosm economy, have a GDP per capita of $40,000 in my single person world and trade with other economies which also have $40,000 GDPs per capita in their single person worlds, then my total spending is $40,000 per year.
If I stop spending $1000 a year on one thing and start spending it on another, such as paying interest on borrowed money, then it's no big deal, especially since most of that $40,000 spending is on junk stuff like calories which make me fat, gymnasium fees which make me poor [and I don't go to despite good intentions], monster SUV which I don't need, lots of petrol for said monster SUV, - oh, I have already saved much more than enough to pay the $1000. See, no problem.
If my little microcosm also controls the printing of said $, then I'm really in business! The others just have to accept my dilution of my debt. Good trick!
The wisest person,
Mqurice |
