US GDP last clocked in at $24.883 trillion in 2Q. The total public debt at the end of 2Q is $ trillion.
That's now a mismatch of 123%, up from 105% in 2013, ten years ago, when the total public debt was $16.8 trillion and the GDP $16 trillion.
In other words, the debt has grown by 82% over the period while the GDP has grown by only 56%.
The debt represents spending money we do not have, and the increase in the debt represents the spending of more money we do not have. We simply create it out of thin air to facilitate the process. It doesn't matter what form it takes, whether in the form of Treasury securities or physical money.
Spending go whirr, Fed money machine go whirr, debt go whirr, and eventually inflation go whirr. Inflation is the payback for going into the debt for which we refused to pay at the time.
Debt draws forward prosperity . . .
But it should come as no surprise that the future we robbed has no prosperity in it, now that we have arrived there.
And people wonder where the inflation came from.
Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.
