If we take Germany, the largest economy in the eurozone, as an example, we can see that interest rate pressure on public budgets is continuing to rise here too. Real interest rates for Germany remain in positive territory and continue to rise. How will the public sector react to this situation? Probably with more debt! There is no way out for the eurozone: it is stuck in the stagflationary trap and must use the printing press to meet the gigantic social obligations that the states have burdened themselves with, which will generate further inflationary pressure and push interest rates up further in the medium and long term.
75 sats \ 6 replies \ @Satosora 31 May
That is a lot of red...
What happens if they dont print money?
Wouldnt inflation go down slowly?
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42 sats \ 5 replies \ @TomK OP 31 May
if they don't print the money, the states go bankrupt. then you have the deflationary supercharos.
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21 sats \ 1 reply \ @0xbitcoiner 31 May
Is this the correct graph to see the amount of money available? One thing I've never understood is how this amount goes down, does the central bank take it out of circulation? Or is it when the debt issued reaches maturity?
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26 sats \ 0 replies \ @jakoyoh629 31 May
Good question, I'd also like to know.
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0 sats \ 2 replies \ @Satosora 31 May
Couldnt they do that on purpose though?
Actually, germany cant make the decision to print money, it has to be the whole eu, right?
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10 sats \ 1 reply \ @TomK OP 31 May
yes indeed, the decision to monetize government debt is made by the ECB. but the path is clear, they make no exceptions, all new government debt is simply printed away. this works well until it no longer works well.
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0 sats \ 0 replies \ @Satosora 31 May
True.
They will just print until its impossible to do.
Soon the paper will be worth more than the note.
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