Debt Leads To War? Can The World Pay $247 Trillion To Avoid It?

Thursday, July 12, 2018
By Paul Martin

by: Daniel

The global debt is reportedly 318% larger than the value of all the world’s economies. The Institute of International Finance (IIF) estimates that the human race owes $247 trillion. One major issue concerning this fact is that very often debt leads to war.

The GDP is the value of all the economic activity in a nation. This means the world’s debt apparently exceeds global economic activity by 318%.

To add to the fear, the world’s debts increased by $8 trillion during the first three months of 2018. To make matters worse, the rate at which the world is accruing debt increased in 2018.

“The pace is indeed a cause for concern,” Executive Managing Director Hung Tran told Yahoo Finance. “The problem with the pace and speed is if you borrow or if you lend very quickly … the quality of the credit tends to suffer.”

Low-quality credit means higher interest rates, which will increase the size of the debt. Therefore, the more the world borrows, the more it owes.

“The quality of creditworthiness has declined sharply,” Tran observed.

If Tran is right, some governments might find themselves unable to borrow money. That can lead to economic chaos and political collapse.

There Is Little That America Can Do

Frighteningly, there is little that America can do about the global debt crisis. The gross domestic product (GDP) of the United States was $19.39 trillion in 2017.

Everybody should be frightened because the United States is the world’s largest economy. The second largest economy, the People’s Republic of China, had a GDP of $10.43 trillion in 2017.

Obviously, there is not enough money on Earth to pay the world’s debts. The most likely outcome of the debt crisis is a widespread default.

A default means that governments will collapse and money will become worthless. An inevitable outcome of a default is hyperinflation.

America’s Debt Has Exceeded $20 Trillion

The Rest…HERE

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