One of the most dangerous mistakes made by economists revolves around the idea that there is no such thing as too much debt or in other words, the idea that the debt accumulation variable can simply be ignored in today's world of let's call it monetary alchemy.


Unfortunately, as explained in this video, that is hardly an accurate depiction of reality. Too much debt most definitely does represent a problem and in just one minute, the most important four reasons as to why have been presented.


From interest rate implications and the diminishing returns dimension to Richard Koo's "balance sheet recession" argument that revolves around behavior changes and the political dimension (the idea that "selling" solutions with respect to tackling debt-related problems is anything but easy), there is far more under the hood than it seems.


Therefore, it makes sense to treat the problem of too much debt with the utmost seriousness rather than simply sweep it under the rug and call it a relic of the previous millennium(s). In one minute, we'll do just that.

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