So what right? Every day some or other dumb politician buries their country deeper and deeper into debt. So what, right? Well.. . so much! Think! We have been telling you time and time again that the unholy trinity (Tax, Borrow and Spend) is literally killing the world economy. This is neither a joke nor an anecdote. This is your life going down the drain. Sure, with the new money the government, your government, will be able to extend their spending spree for a little bit of time. And again. And again. But eventually what? What then? Then, the Economic Cycle of Hell takes over and there is only misery and despair to look forward to. Forever.
Look at what Pakistan did and it is continuing to do. The graph below shows the Pakistani debt over time. As you can see from the trend line (in black), the debt is going up and up and up and up with no end in sight. Have there been “cautious” years? Sure. But look at the big picture. Is there a major trend indicating that the debt level is stabilizing? No. Not even that. Much less going down. Is this plot an exception? No. It is the norm. Don’t believe us? Go to Google and search for the external debt of your country. You will be surprised, just not pleasantly.
Look at the latest “successful” Pakistani bond issue. About $500 million with a maturity of 10 years at a bargain basement premium (i.e. interest) of “only” 8.25%... in a world with negative interest rates. But that’s OK. Because you see, Pakistan will issue another round of bonds for an equivalent sum over the next two days. This will make eeeeeeeeeeeeverything just right! Because you know, sound economics is based on borrowing ludicrous amounts of money at ridiculously high interest rates…Oh…wait…
Sound economics is based on careful and prudent management of acquired resources. There. Much, much better.
But what about tomorrow?
Look, dear boy, you shouldn’t ask questions you are not old enough to understand? Got that?
What? How old do you have to be to understand these issues? Well… let’s see. Take your statistically calculated lifespan and add then years. Just to be sure you have the maturity to understand these deep, deep economic management issues.
What? No, it is not gobbledygook. You don’t get it, do you? Have you seen the differential equations in our economic models? Of course you haven’t! How could you. They are top secret. However, rest assured that debt does not matter. What matters is cash flow. And we assure you with 95.677466838626% certainty that over the next year things will pick-up, economically speaking. Besides, when was the last time that we were wrong?
Oh…last year…. And last month…. And last week???!!!
You have to understand that we were not wrong. What happened was that the underlying economic conditions changed due to unforeseen circumstances and thus we had to adjust the parameters of our models.
What? What is going to prevent a repeat of that today?
Look you little brat. Enough! Shut up and pay your taxes. We know what we are doing!
Sounds familiar?
It should.
This is what every politician and economic drone in government’s pockets is telling you. In so many words.
But what about Pakistan? Ah… yes. Pakistan.
Roadshows were conducted for launching the bond in London, Los Angeles and Boston. We don’t actually know what those “roadshows” may have looked like, but we have a suggestion. Instead of making the bonds more appealing by raising interest rates, how about a little sex appeal. We would recommend to conduct such “honorable” business in a strip club with a few ladies and gentlemen in scarce (or no) clothing. Have a free bar. You know, just to lighten the mood. We believe this would be far more effective, and fun! There is no reason not to have fun on peoples’ money! Errr…. Not to conduct state business in appropriate venues. There. Much, much better!
You know.
For the greater good.
Because there is always a way to ensure freedom and dignity and social justice and a fair life through debt. Just don’t look at the next generation, OK?
Note: please see the Glossary if you are unfamiliar with certain words.
