The second factor is the increase in interest rates, especially in the 1990s. This increase favoured creditors and speculators, to the detriment of debtors. Instead of borrowing on financial markets at prohibitive interest rates, had the state financed itself by appealing to household savings and banks, and borrowed at historically normal rates, the public debt would be inferior to current levels by 29 GDP points.
And how do you appeal to banks and household savings? By increasing the interest rates on offer of course.
These Frogs don’t seem to quite get economics, do they?
The state should cease to borrow on financial markets, instead financing itself through households and banks at reasonable and controllable interest rates.
What the hell is borrowing from banks and households other than borrowing through a financial market?