Will excessive government indebtedness devalue all of our money? | 15MAX



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Eurozone countries are already targeting higher inflation and would like it to approach 2% as this would partly reflect economic growth.

However, statistics from recent years show that this is not being achieved.

However, the behavior of the eurozone and other countries, as well as banks, runs the risk of inflation starting to rise unpredictably, economists say.

According to them, many EU countries will have national budget deficits this year, which could reach 10%. gross domestic product.

Generally speaking, the European Central Bank prints money, governments share that money.

However, states, including Italy, which has high debt, have seized the opportunity to borrow rather than cut costs. Banks have also contributed to this, increasing the money supply and, at times, distributing funds even at negative interest rates.

“Generally speaking, the European Central Bank prints money, governments share that money.” 15 minutes said Nerijus Mačiulis, Swedbank’s chief economist. “We have not seen many examples of this in the modern history of developed countries.”

According to him, this year, when countries are affected by a coronavirus pandemic, the infusion of money acts as a stabilizing factor, but controlling the spread of the virus or introducing a vaccine into the economy will weigh the money for some time. in the form of loans and grants.

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