Who knew when US's debt was downgraded in 2011, it would lead to the largest credit boom in history & the end of nonzero interest rates. The numbers are laughable, nowadays. A debt ceiling of $14 trillion? Debt of only 80% of GDP? What were they thinking?


Today's debt is 106% of GDP & interest rates are going back to 0 in July. Debt ceilings are a thing of the past.  Borrowing 40x of one's income for a mortgage is normal because of the increase in productivity the mortgage allows. Imagine if everyone had to live in Idaho in $1/2 million houses they could afford with cash. Nothing but potatoes would ever be produced. We'd still be carving emails in stone tablets & sacrificing cows to gods.

Thanks to debt, people can move to Calif* & live in $4 million condos. The move to Calif* enabled by credit multiplies their productivity 1000x & turns them into vegans who don't need any food. They can create instant messaging services worth far more than the money they borrowed.
The new paradigm is debt allows greater productivity, allowing one to borrow more than ever thought possible with the increase in productivity provided by the same loans.


https://en.wikipedia.org/wiki/United_States_federal_government_credit-rating_downgrades

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