[quote=FlyerInHi]Another falsity is that we are borrowing from our future selves bit. Why not keep it simple say that we are borrowing from someone else (or our aggregate selves) in the present?
First, we cannot borrow from the future, if that’s what he meant.
Also why would repaying debt in the future cause a cycle? Sure the people repaying debt would have less money to spend. But that would be negated by the other side of the transaction. As Dialo illustrated, there are two sides to each transaction. It’s total spending that matters[/quote]
I think you need to watch it again, brian. What you spend on consumption today (plus interest) will have to come out of future earnings if you are using debt to finance that consumption. Just because there is more debt in the future does not mean that you (or a country) will have more money in the future with which you can pay it off. You are borrowing money today against tomorrow’s productivity/growth.
