![]() ![]() Both countries find themselves far from the 60% debt-to-GDP ratio target set by the European Commission. ![]() Italy’s debt is now at 132% of GDP, compared to Greece’s 175%. On 7/14, the Central Bank of Italy reported that Italian public debt has risen upwards of 2.2 trillion euros in May, a new record for the Eurozone’s second-most indebted country after Greece. The 7/22 FT reported: “Across countries that use the euro, average debt to gross domestic product reached 92.9 per cent in the first quarter of 2015, up from 92 per cent in the previous quarter and 91.9 per cent in the same period last year, according to figures from Eurostat, the EU’s statistical agency.” That borrowing binge helps to explain why loans have been essentially flat since then. Loans outstanding at Monetary Financial Institutions (MFIs) in the Eurozone rose €3.75 trillion to a record €10.87 trillion from January 2004 through January 2009. All of their meddling is resulting in bad vibrations for the global economy. ![]() The global economy may need that kind of restraining order imposed on the major central banks and central planners. A 1992 restraining order barred Landy from treating or contacting Wilson ever again. According to the movie “Love & Mercy” (2014), Landy treated Wilson for psychiatric issues with lots of drugs, which made Wilson more disturbed and dependent on his therapist. In 1983, he was employed as the psychologist for Brian Wilson of the Beach Boys. The problem is that policymakers tend to respond to this turn of events by providing more doses of debt, hoping to make the pain go away. Excessive debt can worsen the economic slowdown, which worsens the pain. The withdrawal pains can be severe once too much debt no longer stimulates the economy. ![]() Fast growth justifies taking on more debt, and it also postpones the bad side effects of too much debt in the economy’s blood stream. It can produce a real high, especially if it is laced with lots of debt. ![]()
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