Topic: A generation spends money, a lifetime pays it back. (Read 441 times)

I agree 100%, 80% of people are in debt all their lives.

I think your point is towards what underdeveloped countries do, the previous generation tried to borrow money under the pretext of improving human resources, but behind all that they also work like a saw, every swing will produce money into their pockets. While the next generation is responsible for paying it back, as far as I know, the new government also has the same ideology, borrowing money under the pretext of wanting to solve more complex problems. This problem is too complicated, it might always revolve around the same line or be like a relay that has no finish line.

The IMF or developed countries that have a lot of money will always reach out to lend money to underdeveloped countries, they also have goals, Some countries have to lose their assets because they fail to pay their debts, such as Sri Lanka having to lose its ports and airports because it failed to pay its debts to China.

The essence of a modern economy is to help one with lesser resources gain access to extra resources, which could be used to invest in areas that matter and be productive in order to stand out and meet up with innovation.
 
The problem starts with either loans coming with high interest rates, making it difficult to meet up the demand, or the most common issue is spending that borrowed money on things that can't be accounted for and having no plan of repayment being laid, which is why some governments go from loan to loan, servicing existing loans, and also borrowing new ones to hand over debt to upcoming ones instead of reducing it.

But we shouldn't forget that in every challenges lies a way out of it, when things like this happens, then we must be ready and able to hold ourself down to the capacity of what we can offer, when we are not too dependent, then we are most likely not going to get affected by the way of the effect of these governments actions and inactions, because we are less dependent on them or their economy policies, instead being independent.

Try to look on a situation when one generation takes a loan, and next generations duty is to pay it back as following - all those loans are long-term investments, and the products they were taken for, will start to become profitable only in tens years or even more. Generation that are to pay back loans, are the one who will get most profit from such investments. For example several countries spend millions to build railroad connection, but next generation will be one who will be its main users or tracks will be their main link to other countries.

I often hear how people complain, that their government took huge loan, and their children will be the one who will have to pay those loans back. But those children, when they grow up, will be main users of infrastructure, technology or whatever those loans were taken for.

Borrowing money isn't a problem if this money is being wisely and efficiently invested by the countries. It means the country is developing new sources of future incomes which can be used to pay for the loans, while generating value and quality life for the citizens of that country.

Even billionaires and millionaires take loans to boost their businesses, and on long run it's worthful because if they had to save their own money before starting a new investment, it would a long time. And as we know, time is money in financial world.

The problem here lies on the fact most managers borrowing money aren't planning carefully how they are going to use it. Then they are creating only debt for future generations.

To some extent, he is not wrong. Theoretically, you are right. That's what true economy should do if you are borrowing for production, there will be more economical growth to pay back in the next generations without putting burdens and making the economy becomes international debt zone. However, we know that politicians are very reckless when it comes to spending, they will rather borrow money for consumption without thinking twice.

Look at the concept of Nigeria borrowing system, they depend on Crude oil, 10 years production of crude oil has already been used to borrow loans to pay back oil that hasn't even be extracted from the well. Now, the new government is extracting oil but some huge percentage has already been signed as loan, part of the money are used to service debts and the country can't do anything. Some of the money that were borrowed weren't used for what it was intended, they were stolen and looted, this is not production nor consumption but corruption.

If borrowing money to elevate the hardship in a country can be seen as a good move but borrowing for personal use and living the generations to come to scrabble on how to pay the borrowed money back then it’s wrong. Some western countries indulge in such act which make them vulnerable to the western world,exposed them and makes them to use their resources knowing fully well it will be hard for them to pay back the loan.

The concept of the recent world economy involving in loan and repayment most often can be handled if only the leaders can manage their little resources. This definition is not just about the government rather generally from my perspective, spending money unnecessarily when you know fully well there’s more to come afterwards no proper account how and when they finished the loan and I completely understand if the next generation has to pay massively for the mistakes. Depending on the kind of loan and how long will it take paying this loan.

The idea of a nation taking a "loan" or basically be in debt, is growth. I mean if you are taking debt but not growing then you are making a mistake, that would not make you better. Logic is that, it could be tax, or it could be a leftist nation that owns factories or something, doesn't really matter, the idea is to take a debt and then make money with it. Same goes for companies as well, the most famous one was Apple taking billions in loans, when they had billions in cash.

Loans means you have debt, and you pay less taxes, but more importantly why not use someone else's money for something instead of yours. Nations will be in debt, and grow, and they will make more money, so pay the debt easier. If they take debt, but not grow, then they will just get worse and worse economically.

Credit that is not used properly will cause a bigger debt. If borrowed money is used well, it contributes to the development of both individuals and states. Many countries with economic problems could not use the resources they had well and became worse off by borrowing. It is possible to reverse this situation with a planned economic management, but it is not easy to provide this management.

Countries that use their income well do not borrow too much and manage to spread their resources to the people. Many countries have experienced both economic crises and good times. With a good policy, the economy can reach a good level.

Yes, debt if not managed properly will be in vain. Every developing country must have debt because the country is in debt for development, debt can be used to finance productive activities and of course for long-term investment. In addition, state debt is usually used to finance productive expenditures, to improve the quality of human resources through education, health, social protection, and of course to build infrastructure.

However, many countries that have debt are not managed properly, such as the amount of corruption and the government's inability to manage debt which can ultimately experience economic problems in the country. Therefore, the country needs to regulate debt so that it does not cause dangerous impacts in the future. As conveyed by OP, owing to the current generation and then the next generation paying it off so this can be said to be unproductive debt and this is very dangerous for a country.

This is very sarcastic, government borrowing money for a long-term without repaying them due to some kind of embezzlement of such funds by the so called government officials and thereby  abandoning the debt for the incoming government and continues from their until it reaches the next genarational leaders which is not suppose to be so, yes of course, what do you expect from leaders of countries that has nothing to offer, we have seen a situation where most countries borrow from a particular country for what they call infrastructural decelopment and still award the said contracts to the same country they borrowed the funds from, pay them with the borowed money and embezzle the remaining funds failing to service the debt for the next government to inherit the debt, this happen consistently because of lack of transparency among the so called political elites.
Yea, projects that will generate revenue or infrastructures that are meant to ease citizens livelihood, create employment in conclusion and to help in repaying back the borrowed funds are supose to be projects that government can borrow to finance aside this kind of projects, borrowing is useless.

The institutions and countries you mentioned are supposed to be happy because after all they are doing business, we don't expect them to turn down business that will benefit them, so the people that are to be blamed are the borrowers themselves, the borrowers has failed to do the needful by going into full industrialization that are capable of reshaping their countries economy thereby making them to be known in production capacity.

The essence of . modern economy is simply pointed at creating resolutions of how to make life easy for mankind. Modern entrepreneurship and technologies has crucial roles to play on this modernity.
Interestingly, borrowing money and paying back is and exchange of service which could even enable us set-up a goal of interest.
You can imagine loaning from the bank to start up a business?
Then you can imagine when you have business ideal but got not capital to start up but an opportunity to borrow could play that essential helping hand to reach your goal.

And of course, debt it debt which means we are expected to pay back money borrowed. So we either borrow that we can possibly payback in returns or better don't borrow what you can not afford to pay back.

From an individual perspective, you are right, and one shouldn't do that, but from an economic standpoint or to maintain a whole economy, it becomes necessary for countries to take loans. you are right that one should at least be able to repay the loan. Countries that don't have good economies in general will barely be able to repay the loans because they don't generate much revenue within their country, so they don't have a way to earn money and then return the loans they have taken.

In such cases, the loans keep piling up, governments keep changing, every new government takes more loans to continue their operations and make the country dive deeper into the ocean of loans because they don't care, they are in power today and won't be in power after a few years and the next group of people who gets the power will have to bear it. This continues for decades and centuries sometimes.

"a generation spends money"?
a generation is ~ 20years

in government the phrase should be:
'a 6month budget report spends money, a century of tax increases pays it back'

The situation at which this situations occurs needs to be studied and amended appropriately.So many countries will be left unguarded if they don't borrow or loan.Meanwhile,the damages from the previous government incompetence and mismanagement will make the successor confused and screwed-up with bunch of financial loads to pile up and update,which is quite unnecessary.

This often happens in currup countries where government take unnecessary loan for the sake of the economic development of the country, where as it was for their selfish interest. At last they end up mismanaging the funds or share it among themselves without considering the effect it will cause to the public. They end up stacking up loan for the future generation instead of development.

Though loan is good for the development of an economy, but it must be  controlled by those financial experts who can handle the affairs of the government effectively without mismanagement. A loan not properly used is equal to a waste loan.

Do you need to call someone a fool for expressing his own views about a topic? You should learn how to express your views without insults because you don't expect everyone to have the same view as you. Sometimes politicians fulfil their promises even in your country.

Do you have any proof that Trump will continue with Biden's policies on the Israel/Gaza/Lebanon conflict? All we can do is speculate and wait until he takes over. Don't also forget that the US is not just finding only the conflict in the Middle East. There is also the war between Russia and Ukraine.

Your position that Israel controls the IMF and the global economy is an overestimation of the financial strength of Israel. Without funds from allies, Israel will not be able to survive.

Bro funds are very important for every country to do progress in this time. And if you are trusting on Donald Trump statement then you are fool because Donald trump is political person and he will change his decision with time and nobody knows what will be future step of Donald trump but Trump is against Muslims and he is encouraging Israel to kill Phalasteen citizen and after this action USA economy will be strong and Trump will also provide weapons to Israel because Israel have full control of World Economy because they are owner of IMF and they have power to stop any country fund . Iran is attacking on Israel and Donald trump is ready to fight against Iran .USA economy will be strong if they entrap any country which has good resources but if they became successful then Dollar value will go down .

Loans are a very important source of revenue for most governments. Without borrowing most nations will not be able to finance their budget. The problem in most countries is when these funds are not invested in profitable ventures. In most countries, loans are used to pay recurrent expenditures or even stolen by corrupt politicians. Other countries prefer to use their funds to support wars instead of spending it for the good of the citizens. Trump has said he would stop wars which means he might cut funding to some nations since the US spends so much on war financing.     

If this is done by a country that has the potential to become a developed country, then this will go well, but if it is done by a country that has chaotic politics, then the impact on the future will be very bad.

Likewise, if the debt is made by an irresponsible person, then that person will only pass on the burden of debt to his children in the future. Therefore, I will try as much as possible not to make debts that I cannot pay because I am worried that the impact will be very bad for my family's life in the future.

It would have been okay if the generation that the government borrows the money from the World Bank utilized it well on their behalf rather than sharing it with the "so-called government" without giving an account of how the money was spent. Who will then ask, though, to have the courage to question the government how the borrowed money is spent without being arrested or threatened the next day.

Government borrowing money has been an easy way for the government to siphon the money that will boost the economy for their selfish gains. I don't know whether there have been any new governments that took over power that didn't want to borrow money from the World Bank. For my country's government alone, they normally do. In each of their four-year tenure, they must borrow up to five times in their first tenure. The amount they borrow each time amounts to millions of dollars.

Your right about saying a generation spends money and anothet pays it back but I'm not sure it has a connection with  the modern economics, cause of a truth the world economy is depreciating due to inflation and other factors but it  doesn't depends on the amount of money being borrowed to meet up some requirements in the country. I think the economy sectors is at a stop because there's no efficiency in the demands and supply so everything is being affected.

Ok, that's true but at least it's more better than some countries. Where I come from, the leaders take loans to help them run the country effectively like you said yet there are still loopholes and even though they(America) owe such an amount, I believe there's laid down plans to offset these debt but in my country, you wonder if we'd ever be rid of these debts and sometimes I wonder if these figures aren't exaggerated by that leaders to further extort from the citizens.

I do not think that a country can be run effectively without taking loans. Most big and rich countries are indebted. For instance, US national debt is lingering around $34 trillion. No state or nation runs on a deficit national budget. The government need the multitudes of money to run national affairs.

The best we can do is to avoid such cycle from ever taking place, and while there are things most people will be forced to buy in credit, like a house, everything else must be paid with cash, and if we do not have the money in hand to do so then we must not buy anything until we do, now I can recognize this can be difficult as we are bombarded every day with ads that try to persuade us to buy everything right now, but we must find a way to ignore them, because if we do not, then we will find ourselves spending money that we do not have and we will have to pay huge interests to the banks for doing so.

I'm not sure putting it in the context of a "generation" is correct, the thing that makes more sense is how we very easily spend money when we are younger - constantly bombarded by peer pressure and the race to have the coolest stuff, which can often lead to easily accumulating debt and not necessarily understanding the consequences of having to pay it back. If you get credit when you are younger, it can feel like you've won the lottery and got a load of free cash, which is then spent like crazy. However the pain comes later, when you realize your paycheck is starting to get eaten up by debt that you may barely make a dent in repayments if you've racked it up on credit cards paying the minimum balance every month.

These corrupt leaders don't want their activities to be monitored that's why they'd always kick against the use of the Blockchain. Like you said it's because they don't care about how these loans get paid that's why they continue to take them because if you're concerned and know that it's for something beneficial that you need the loan for, you'd achieve it and definitely make profits enough to repay your loan before going for another.

This is not the true concept of borrowing even in this modern era, most
Government borrow for key infrastructural development purposes with strategic repayment plans put in place, citizens on one hand are bound to hold government accountable, the parliament is there to help checkmate the executive. I don't have any issue with the concept of borrowing, but the big question is, what are you borrowing for?, are you borrowing for consumption or your borrowing for production.

Borrowing if done responsibly is supposed to improve one's financial status without putting any burden on the borrower or those that will take over from him in the future. The reason Borrowing appears to not be the best option in most cases is because those who borrow do not practice responsible Borrowing.

Responsible borrow demands that the government or private individuals take only debts they can manage. The debts taken should be able to fund projects that will generate revenue capable of repaying the loan and the interest involved without neccessarily passing it down to other people who would finally bear the burden of debts they know nothing about. If this is not the case for those who borrow, it means they are only promoting misappropriation of funds without any intention of solving any problem.  Lenders will keep lending money because they benefit the most.

That's how government works, they dictate what is valuable for the people to trust in it that it has a value. And that's how it goes with fiat and just as we in the community, we all believe and have a huge confidence in the value of Bitcoin because we all trust it. Now, with the borrowing generation or whoever borrows money and spends it, this is what the government wants us to do. They want us to pay our lifetimes into these debt so that we're already tied to it and that's the trap that many are looking at.

This is also happening in my country, huge loans are constantly being taken, from all sides... the rich are getting richer, and due to rising inflation, everyone else is in a worse and worse situation. Not only will we and the next generations pay back that debt with all interest, but the country will be sold to "investors" with all the resources and other benefits the state provides them (lower taxes, cheaper fuel/electricity, and cheap labor). That's the reality and it's been happening here at my place for years.

And is there a solution? I see only one thing, the system has to change, and to do that, people have to wake up and the collective consciousness has to work... but I doubt we will see that anytime soon.

That’s typically what the modern economy is all about, one set of people given the privilege to look over and govern the affairs of the rest people misuse the mandate given to them and take loans that cannot be paid back for years to come. They themselves know they won’t put it into anything resourceful over the years that can enable them to pay back the loan and therefore makes the later to pay for all they’ve indebted which cannot be possible again due to inflation and worsen state of the economy at the time. They the new government would also want to take new loans in order to get a share of their own pocket. This is very disgusting and as it continues like that for years, the country overall economy gets worsen and those that are yet to be birthed will be asked to pay back those loans. Borrowing of loans isn’t bad but not putting it into good use is disastrous and will cause economy downfall of the whole nation. The richer nations given the loans get richer and the poorer nations get poorer.

incompetent leader corrupt everywhere, the rich country just know how to take advantage of it, giving temporary money for lifetime debt, which is a bad thing, but some country just can't stop taking out a loan , it's good knowing that certain country actually try to pay off its debt, but majority just doesn't care, not their obligation to pay anyway, that's what their tought process as I imagine, if only smaller less developed country could just take radical approach, adopting blockchain for its transparency and monitor the spending, maybe things could've been a lot different.

Words like that don't describe modernity because they just look ordinary. And the question is, why borrow money if you can't use it in a business that can turn money around and make a profit so that the same generation can pay the loan back. This means that borrowing money must have a clear direction because it is not a mandatory job so that most people will not want to do it when they can't use it properly in their own lives.

this is so easy to relate with because it's what's happening across different nation most expecially in mine. Every government will borrow money to fix the mess the previous administration have left behind only to create a worse deficit that the coming administration will come to fix. It has gone to the extent that the debt they are currently owing can't be payable till almost this generation ends because the borrowing continues and there's no sign that it's coming to a close.

Borrowing money wouldn't have been an issue only if it's used for the right purpose that will yield better returns. Unfortunately, that's not the case as all the money that's being borrowed is either used to sort out insurgency, sent to house holds as palliative or even embazled by same people that collected it only for the next administration to come again to repeat the same process over and over again.

World bank and IMF ought to stop giving some nations loan for a project that's not able to yield good returns. I'm aware that when it comes to individual sourcing for a loan,  there are clauses that include telling the organization or person you're obtaining the loan from how you intend paying it back but when it comes to national loans, I don't know if such a thing is in place or else some clueless countries that keeps on collecting and increasing their indebtedness would have stoped taking loans recklessly.

In my opinion the problem lies less on the borrowing part and more on where these borrowed money go. These borrowed money are not used to invest in profitable projects but instead are wasted going onto the pockets of the leaders of the country. Are there any countries that were able to pay back debt? I am sure there are and they are probably doing well right now and their politics might not be as dirty as other countries especially third world ones.

The corruption in third world countries are so immense that no amount of borrowed money are enough to actually improve our economy because like I said it all goes directly to the pockets of corrupt politicians. Debts can be paid if the right people know how to or want to but otherwise yes the future generations are the one to suffer.

 Sometimes, the loan givers knows that some countries who come seeking for loans may not have the ability to pay them off at the stipulated time and would rather prefer to still keep giving them so that these ones would remain indebted to them for a longer while so that when another set of individuals who come into power try to attempt at paying, it would seem too big for them and now instead them to channel their energy and resources into making the economy of the country better, they would exhaust it all in paying off debts which is sad.
 Sometimes I wonder why a country would need to take a huge amount that would be burdensome and yet you won't as a citizen see the effects because some greedy leaders have chosen to pocket them and the citizens have to pay for what they didn't use.

Well, that's how a debt based economy works! It's printing money out of thin air. Let me give you an example,

Let's assume a central bank prints $10. Then bank A borrows that $10 from the central bank to bring it into the circulation. Now an individual borrows that $10 from bank A and deposits that money into his savings account in bank B.

So in theory, that $10 would be shown as asset in bank A. The same $10 will be accounted as liability of the individual. Also the same $10 will become a liability of bank B towards the individual. That's $30 in circulation and not the same $10.

That's how money is created out of thin air in debt based economy. Crypto is the answer to this flawed banking system.

With high interest rates, inflation, and taxation today, impacts from debt resonate within the individual generations.Take from one of the biggest economy in the world, the US interest payments on federal debt are now at an all-time high and siphon budgets away from needed services, like healthcare and education that benefit all people alive today-not just future taxpayers.

Meanwhile, debt reliance can become more and more issue-related to burdening future taxpayers, but even hinder economic development-as high levels move money away from investment that may produce returns over time. Some economists indicate that this may be reduced in the future through policy choices-make targeted spending cuts or reforms. Debt is indeed a shared responsibility, but that does not mean only future generations bear the load; it's an issue for the present too, since the interest payments and need for budget adjustments are being felt across age groups.

I don't know whether modern economics has anything to do with people borrowing money and mismanaging it, leaving the burden of repayments to future generations. And leaders of countries that depends on borrowing and diverting most of the funds into their private pockets, leaving incoming administrations with the responsibilities of repaying. What happens is that the incoming administration will also borrow and divert most of the monies, while the dept continues to pile up. People and governments are supposed to borrow money to fund projects that will generate income, and from the profits that they get from the project, they'll be servicing the dept.

I guess that the world bank, IMF and industrialized countries like China, are happy to dish loans to most underdeveloped countries, in the end they'll own the countries indirectly. It's very convenient for people in leadership positions to take loans that'll run for a long term beyond their administration because it won't be their responsibility to repay. They're free to embezzle the funds without any remorse and when a new administration comes to power the first thing they'll tell the electorates is that they've inherited too many depts.

Let me give a a typical example. My country's government just borrowed money from the World Bank which is running in billions of dollars.They say the loan is to stabilize the economy blah blah blah but honestly we don't need those loans. The first repayment is in 10 years way after the current administration has left office. Obviously I have no faith in the because they are going to divert it into personal coffers and their will be no penalty for it. We don't need these loans. Even the loans are a trap by the World Bank to keep poor countries poor. The next generation is going to spend their lifetime paying back loans.
Here it is - https://www.google.com/amp/s/punchng.com/tinubu-govt-borrowed-6-45bn-from-wbank-report/%3famp

The essence of modern economics can be summed up in two words: borrowing money. One generation spends, and the next spends a lifetime paying it back.