ECONP_007. Debt

Debt is both a useful way to help develop / innovate new solutions both for the household and the enterprise. Debt can also be a burden if not managed or used effectively.

Advertising is a way to increase demand which makes debt a viable option. (loans and credit cards).

On the other hand, debt comes with a cost (sometimes excessive) for the privilege of using money.

Debt also can be used to expand the money supply and create more demand.

Debt on unreliable or unsafe products (e.g. junk bonds) creates additional stresses on businesses.

Households can find themselves in too much debt without any safeguards.