So, government should go and borrow to spend, doing the dissaving that no one else will, to get the economy out of that hole.
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George Osborne's move today is designed to allow the Bank of England to play a bigger part in generating growth, due to the government's self-enforced inability to borrow more to spend on infrastructure etc.
All things being equal, low interest rates help the economy by making it easier for consumers, businesses, and governments to borrow in order to spend and invest.
The K solution is that Keynesian idea, borrow more to spend more and thus increase aggregate demand through that multiplier.
It's with a budget that leads to broad economic growth by moving from an era of borrow and spend to one where we save and invest.
As we argued in our first ESSAY on this subject, one of the surest roads to hyperinflation is one grounded in a government whose answer to every economic and social problem is to borrow and spend the problem away, supported by a central bank able, willing and ready to finance the effort simply by printing money.
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So this is all part of the notion that we don't want to just borrow and spend -- we also want to make stuff and sell. (Applause.) That's part one of the plan.
Too much printing when the desire to borrow and spend is high can create inflation.
Just how much governments of rich countries should borrow and spend to boost their economies is disputed.
Lower interest rates encourage households and companies to borrow and spend.
This whole process is to get us to borrow and spend.
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Like the Fed, the Bank of Japan is buying massive amounts of government bonds, seeking to keep interest rates low to encourage people and businesses to borrow and spend more.
The Bank of Japan, under new Governor Haruhiko Kuroda, surprised markets by saying it would greatly increase the country's money supply with the goal of encouraging people and businesses to borrow and spend.
It will only wreck the ability of future governments to borrow and spend, along with the investment returns of those left holding debt that deficit worriers have for decades been telling us is worthless.
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Imaginative though the new plans are, they are based on the belief that you can persuade the private sector to borrow and spend more in the current environment, even when everyone's natural instinct -including, apparently, Mr Osborne's - is to conserve cash and get control of their debts.
Yet, somehow, he and his fellow policy-makers at the Bank must convince the country, and the City, that more quantitative easing will meaningfully offset this gloom, and that further steps - like easing the liquidity requirements for banks, and the "funding for lending" scheme - will finally encourage banks to lend, and firms and households to borrow and spend.
Alongside the gain in assets has come an increased ability to borrow against them and an increased tendency to spend as if the asset appreciation would go on forever.
All of those things laid the groundwork for being able to borrow more and spend more, but also I think the media, including the news media, does an awful lot to encourage overconsumption.
Louka Katseli, the development minister, thinks Greece should borrow and spend its way back to growth, with generous handouts to low-income families.
The Fed has made sure that there is plenty of money to lend, but in the process may have reduced the confidence that borrows need to take risks, borrow, spend and expand.
The easier and cheaper it is to borrow, they argue, the more likely business and consumers are to spend.
All he has to do is borrow against it, spend away, and then die.
The Southern Strategy and Borrow and Spend Strategy however turned out to the self-limiting.
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Obama's "solution to virtually every problem we face is for Washington to tax more, borrow more and spend more, " Rubio said.
If the Chancellor wants to spend more to give the economy a boost he can also borrow money - but don't forget, it has to be paid back with interest.
But they think higher growth is worth the long-term cost of higher borrowing - that if the government is going to be forced to borrow more anyway, it might as well choose upfront what it is going to spend that money on.
Nevertheless the illusion of new-found wealth has caused households as a whole to save less and spend and borrow more.
Lower interest rates boost house prices which in turn encourage people to spend more by making them feel wealthier and giving them more scope to borrow.
The fact of the matter is that that they can borrow means that they will have the money to spend on things, and that means they'll have the money to spend on expansion.
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