Whether a huge national debt indicates a bad economic situation in the country has been always a big question for me. Look at the list of top 5 countries with the highest external debt:
Can we say that the countries from the list above have poorer economic situation than that of the countries from the list below?
Source: https://en.wikipedia.org/wiki/List_of_countries_by_external_debt
Or, if we take GDP into consideration,
Would it be right to suggest that economic situation in Sudan is somehow better than that in Japan?
Can we say that the countries from the list above have poorer economic situation than that of the countries from the list below?
Source: https://en.wikipedia.org/wiki/List_of_countries_by_external_debt
Or, if we take GDP into consideration,
Would it be right to suggest that economic situation in Sudan is somehow better than that in Japan?
Exactly. The amount of debt doesn't inherently matter, particularly when all major world currencies are fiat monies with floating exchange rates. What matters is lending liquidity and ultimately faith in the underlying currency.
I'm not saying the USD will never collapse, but the people perpetually predicting it for the past few decades remind me of this:
