The average person in the world owes $86,000

Debt bomb

Does anyone seriously think that this is sustainable? And if it’s not sustainable, then how can it end without causing a massive global economic implosion the likes of which humanity has never seen?

Global debt hit a record $184 trillion last year, equivalent to more than $86,000 per person — more than double the average per-capita income.

Borrowing is led by the U.S., China, and Japan, the three biggest economies, the International Monetary Fund said Thursday, highlighting potential risks to global expansion given that their share of debt exceeds that of output. Overall, the amount of worldwide public and private debt is equal to about 225 percent of gross domestic product.

Total debt is up 60% since the global financial crisis a decade ago. In the meantime, the US government has something like $80 trillion in total liabilities, if you include Social Security, Medicare and Medicaid obligations. That doesn’t even count state and local government debt. In 2014, a team of economists estimated the nation’s total “fiscal gap” (defined as “the difference between our government’s fiscal obligations and the present value of all future projected tax and other receipts”) at $210 trillion. The numbers are so large as to be silly.

The social safety net is going to fly apart like a cheap hammock. A lot of people are blithely indifferent about this, which I find puzzling. But I don’t know, I’m not an economist – maybe this is all… fine? Maybe the problem will work itself out somehow, so we can just keep spending astronomically more money than we have, year after year, forever?

Somebody, please explain this to me. Slowly, and using small words so I can understand.

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