Why global debt may never fully be repaid.

[bitgolden]

It was not designed to be fully repaid, it was designed to create bigger revenue so we could have bigger debt. If you had 100 income, and 150 debt, then you used that 150 debt to make 150 income, and then get 250 debt, and keep repeating that until you make 2500 revenue and 4000 debt, and it goes on forever.

This means the debt is not designed to be paid, it was never meant to be, the new revenue pays the old debt, and new debt paves the way for bigger revenue and so on and so on.

[davis196]

The general assumption at face value when it comes to the repayment of debt is that, eventually countries pay up and are free from indebtedness. While this is true principle, it is quite different from what is in practice. Here's why;

At sovereign levels, many economies are surviving by; refinancing debt and rolling debt forward,bin some cases countries even surrender a chunk of their natural resources for a couple of years to be able to qualify for more indebtedness.

With critical analysis we're seeing that the modern financial system is functioning more like a perpetual debt maintenance than a normal repayment structure.

What this means is that, inflation is may become politically preferred to austerity, changing the long term meaning of currency preservation.

Global debt would be slowly devalued rather than repaid. This is the smart approach(but it causes inflation). The governments trying to cut government costs and raising taxes would only put the economies under greater pressure. I remember the Romanian dictator Nicolae Ceausescu, who was obsessed with the idea of repaying all of Romania's national debt, which lead to Romania suffering from terrible economic stagnation and the population of Romania drowning into poverty during the 70s and 80s. Debts are always being paid in one way or another, it doesn't matter if it's inflation or austerity.

[Somegory]

Many countries around the world are not fully paying of their National debt instead they are keeping it at a manageable level according to their economic growth. They are refinancing their old debt with new borrowing. Main problem rises when the value of the debt grows faster as compared to the economy of the country  and the government become dependent on the value of inflation so that they can reduce the real value of what they owe. It is very easier for the government to increase inflation as compared to increasing taxes but when there is a very high increase in inflation then the value of the currency becomes weaken .

Leading a country isn't just about creating jobs and handling good roads, when opportunity presents itself a leader must know how to act immediately and seize the opportunity.

Many countries today would have get out of debt if they know what they are doing, for example I remember when Bitcoin was a thing in 2020 and there was total lockdown everywhere, a leader in my country decide to use the country power resources to mine Bitcoin.

People are so dumb that they ignored him, with the power sector in my country we would have settled all debt if we start mining Bitcoin at that time and hold till 2025.

[Uhwuchukwu53]

Looking at the trajectory on how many countries borrowed and some time morgege their natural resources which most time can't be equates to what they are owning as debt it implies that such institution have an unknown target towards the debtors which seems hidden even if they are not able to pay back in full may pay in future. Inorder words I see this process of not mounting pressure of repaying in full by world bank as means of sustainability of most countries who are vulnerable to meeting standard of living in the society using the debt as grace of pushing them to work hard in meeting certain target before taking more, because what happened is that you must gives details of what the loan is for before they released it.my country has some debt which most at time offer of loan is given to them when they requested for such without even clearing the outstanding one it means that such that must not be cleared before taking another but it's another means of also enslaving the economy because they leaders that failed to work with the loan keeps the nation in running a continuous debt profile.

[hafiztalha]

Global debt first of all can never be repaid. I just think all we are doing is one big Ponzi scheme. Never ending. Always running. Printing more money to finance a debt that keeps growing and the circle continues.

Most of these countries that borrow money from IMF will never grow economically. It's by design. One big debt trap.

Let's put this into perspective. If the world owes money. Who then are we paying it to? That alone will tell you no debt will ever be paid. It will just keep on climbing until the entire system collapses.

On global level it is not possible to eliminate the depth 100% it only rolled over as the economies started growing or when the old policies are being replaced by the new ones. Global debt does not work like a household debt that can be eliminated to 0%. There are multiple factors on which these debt depends like the GDP growth of the country, their interest rate ,productivity and then their different policies. There are example of many countries on the global level that have a large amount of debt on them but still they are working fine without being collapsed because their economic output is supporting them.

IMF has different programs that are designed in such a way that it help the economies to stabilize themselves when ever there is any sort of crisis or the conditions are not okay so the global debt are distributed across different institution of a country their institutions, pension funds , their banks as it is a network of publications with any financial system not a single structure being never fully paid off.

[slapper]

So many people perceive sovereign debt as a solvable issue. It isnt. Once you have eliminated the debt, everything collapses. Debt IS money in a fiat system. Most dollars are created when someone borrows them into existence. Pay it all back and you literally delete the money supply. Right now African nations are in net negative financial flow with some creditors. More going out in repayments than coming in as new funding.

All layers of this system converge towards the same outcome that you reached: The default mode becomes inflation. Austerity leads to riots. Literally. And default leads to market contagion. So what is left? You let the currency absorb the damage quietly. Year after year.

[Accardo]

It's just my opinion that the global debt system is designed to be permanently unserviceable. I've observed that even countries with very low debt-to-GDP ratios, between 0.5% and 2%, simply let that level languish, even though I'm sure they can afford it. Debt doesn't just indicate a need for funding; it can also indicate a larger strategy, such as a cooperative relationship between countries.

A nation can't run effectively without taking domestic and external loans from investors and other nations for favors and internal deals. Successful companies give loans to a nation to seek the hand of the leaders in times of national needs, the loan get paid gradually, but hardly get cleared completely by the government, and the lender may as a result make more deals with the government, instead of asking for their money back.

[JeffBrad12]

It was not designed to be fully repaid, it was designed to create bigger revenue so we could have bigger debt. If you had 100 income, and 150 debt, then you used that 150 debt to make 150 income, and then get 250 debt, and keep repeating that until you make 2500 revenue and 4000 debt, and it goes on forever.

This means the debt is not designed to be paid, it was never meant to be, the new revenue pays the old debt, and new debt paves the way for bigger revenue and so on and so on.

It's basically like the debt is the core of modern economic system and is meant to exist from beginning until the end.
The reason why developed countries are maxing their GDP to debt ratio is because they know damn well this is how it works and they want to take advantage of it well. Country like japan, is becoming rich because they know how to play the game.

[dansus021]

simple answer the government always need money to fuel their economy, so they need a good school, healtcare and lot other social things but all of that need money and just like startup its looks good on paper but we didnt know when reached profitable business. That's the anology.

total worldwide debt is currently knocking on the door of $350 trillion. According to the OECD’s latest Global Debt Report, an astonishing 78% of all sovereign bond issuance is used strictly to refinance old maturing debt. Governments aren't clearing their tabs; they are just rolling the principal forward into new bonds, and because interest rates remain structurally elevated, the cost of just servicing that interest is eating national budgets alive.

INFLATION is one of the effect of lot of borrowing money or creating money by continuously expanding the money supply, they erode the value of the currency. It allows them to structurally cheat the system by paying back decades-old debt with newly printed, heavily debased money.