The big news this week is Mario Draghi and the European Central Bank (ECB). Let’s look at that, but first let’s see if we can take a 30,000 foot view at the problem and how the markets might behave going forward.
Collectively, the number one global problem is DEBT. Can we grow our collective incomes in a healthy way that we are able to cover our debts? For long periods of time, debt helps to fuel growth but at some point it becomes too big. Think in terms of what you earn and what you have to spend after you pay your bills. When you have too much debt and more of your income goes to pay off your debt, you have less to spend on other things. Your economy slows.
