It seems that most if not all advanced economies (US, Japan, UK to name a few) have been running budget deficits since basically the last 20 years. I understand that current debts lose value over time because of inflation and economies grow, but how can they do this for basically ever? I can’t wrap my head around the maths that makes this possible, and the markets don’t seem all that worried
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National debt isn’t like personal debt. It’s more like people betting on the future ongoing success of the country’s economy. The US national debt is mostly held by members of the public, in the form of Treasury bills (T-bills), T-notes, bonds, etc. People hold these as investments, because they reliably pay off: the US government has enough revenue growth (taxes raised from an expanding economy) to reliably make payments on this debt.
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