You're partially correct about the mechanism, but the money is anything but virtual. In advanced, stable economies main way of creating debt is through bonds. ANYONE who buys bonds is the government's creditor.
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Also the figure cited is not government debt, but total debt (including stuff like student debt or mortgages)
aug 13, 2025, 2:50 pm • 1 0 • view
I put quotes around "virtual money" exactly because it's a crude simplification. The vast majority of money is created from nothing by regular banks when they grant loans. The loan is meant to be paid back, ultimately through real production. The idea our goal should be not to have debt is wrong.
aug 13, 2025, 3:02 pm • 3 0 • view