How Does a Country’s Debt Affect its Citizens?
Currently my country, Philippines, has tons of debt and it keeps increasing every year.
There’d be stats like, each Filipino has 120k php (around 2.3k usd) of debt. But of course the individual doesn’t directly pay for the debt but rather supposedly taken from the taxes we pay.
So how does it actually work?
If that comforts you, the debt per capita index is pretty much meaningless without any other external factorSwitzerland has one of the worst debt per capita and isn’t a poor country by any means.
The USA also owes over 16T To other countries
Still vague to me. Care to explain on the external factors that make it meaningful?
Tbh more or less matters on an intra-country scale, as US could borrow a shitload anytime and pretty much everyone would be happy to take that investment. Investing in the Philippines is much less attractive, and so gives them less spending power
ok, so. the way I see it the same as in investment. As long the debts can create revenues, you can pile up more debts.
That’s the way I see it as well. And probably why we don’t see that metric often. GDP is more an accurate indicator of financial stability / purchasing power (although also flawed)