A drawing about debt made in 2006 because of the UK’s large individual and collective liabilities. These debts become more of a burden during a recession as the amount of money in circulation reduces. People worry, save cash under mattresses and lose their jobs with an increasing chance an individual debt bubble will pop under them.
This is why on top of the government’s new national borrowing requirements, there is talk about printing more money to ‘pump prime’ the economy (the euphemism this time around is ‘quantitative easing.’) The downside to printing more money, or increasing liquidity, is that it further devalues the buying power of money already in circulation between the public – and prices appear to, or, actually go, up. That is, or feels like inflation. And as a friend was saying on the phone last night, haven’t tomatoes got expensive?
UPDATE: 2pm. More long words from the FT here