How can an economy be bases on debt , such as the US, and how does it work?!
In: Economics
The USA may be in debt, but it does pay off its debt; debt isn’t terrible if you have plan to pay it back. It is often better to have some money now then more money later. With money now, you can build and invest so that your investments will pay off later. If you plan it right, the investments you buy with your loaned money should be worth more than what you will have to pay back in interest. This is especially true with lower interest rates. The USA keeps going into debt because it keeps investing and thus makes more money.
This only becomes a problem if you don’t invest properly and don’t make money from your loans. Not only do you not make money, you lose money from interest payments.
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