"... .... The significant ratio and to watch is the ratio of additional debt and additional GDP, or the amount GDP was generated by creating new debt $ 1 . It is this ratio that determines the quality of the debt. The higher the ratio (additional GDP / additional debt) are reaping the most successful entrepreneurs in increasing productivity, which is really the only justification for borrowing.
Instead a significant drop in this ratio is a dangerous sign that the debt quality is deteriorating, and that additional debt has no economic justification . "
"We run into the same wall that collapsed above all civilizations: the law of diminishing returns leading to societal collapse.
As the population grows, the diminishing returns of various food supplies begins to threaten social complexity, which can lead to a Malthusian collapse.
replace power per credit and the situation is the same. "
Credit is but a proxy of future production, the collapse indicates that such production is not going to happen. It is announcing the demographic catastrophe. Comment
collected in: Burbuja.info
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