How can the US national debt be over $23 trillion if that much money doesn’t even exist in the world?
In: Economics
We have an inflationary monetary system. Meaning we increase the total amount year by year.
That money is created through debt, basically someone who wants more money than they have asks for it. That money is created and added to the total supply.
Because that (and all) money is created by debt, all money in the world is owed as debt by someone to someone else.
Debt of course has fees and interest to be paid on top of it, meaning that even more money is owed than what is borrowed.
In summary; money is made by debt, loans require interest. Therefore there is always more debt than money.
If everyone tried to pay off all their loans (people, business and governments) there would not be enough money in the world to do it.
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