Does country’s debts affect anything in that country? Why some have trillion dollars debts that look like it’ll never going to go away yet they can chill about this fact?
In: Economics
It does go away. The debt is constantly paid of but new debt is also constantly taken on. So as long as the old debt is being paid of there is no problem because every one gets their money. Countries still get into trouble with taking on to much debt what point that is hard to determine. There are a few metrics that try to predict this like debt to gdp % or debt growth compared to gdp growth. For example it is considered bad if debt growth more than gdp in a year, that still doesnt mean a country cant pay of its debts when this happens. These metrics still dont provide a number where you can say a country will have problem when they reach number x.
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