How is it possible that the world is in debt?
Answers
Answer:
Governments, companies and households raised $24 trillion last year to offset the pandemic's economic toll, bringing the global debt total to an all-time high of $281 trillion by the end of 2020, or more than 355% of global GDP, according to the Institute of International Finance.
Explanation:
Think of it this way. If you borrow $20 from your buddy, who has the money? You have the money. You’re in debt to him for $20, but you have the $20. You started with $0, now you have two things, a debt for $20 and $20, which adds up to $0.
The problem here is that the only reason you wanted to borrow the money is so you could spend it today.
So you spend it on that pizza. Now the pizza guy has $20, you have $0, and a debt for $20. Now you have negative $20.