Why Is the World In So Much Debt

Taxes like land-value levies or vacant-property charges change the math on holding idle assets because they impose carrying costs, which makes putting capital into productive investments relatively more attractive.

To fix inflated balance sheets you need GDP growth that outpaces asset and debt value growth because rising productive output realigns balance sheets with real capacity rather than relying on price gains.

Reported wealth is based on recent market prices because accounting records assets at last transaction values, so paper gains are not the same as liquid cash and can vanish if prices shift.

Banks create matching loans and deposits that move purchasing power between savers and borrowers, which is how households secure mortgages and builders get paid to produce real assets.

Asset price gains mainly help existing owners because appreciation, not income, delivers the upside, which concentrates wealth when prices grow faster than wages.

When corporations buy back their own shares they inflate equity prices because repurchases raise demand for shares instead of funding capital spending that would boost productivity.

If money tightens while many try to sell, more assets will chase fewer dollars, which forces prices down, wipes out paper wealth, raises loan-to-value ratios and triggers rounds of forced selling and deleveraging.

Stimulus checks and quantitative easing increased the money chasing the same assets, which bid up prices and created paper wealth without equivalent new goods or services being produced.