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So we can finish up in a position which is exactly equivalent to 1 exactly where the distribution of income had been financed by an boost in debt in the initial place: a standard fiscal expansion. This would destroy the income but clear the liability, leaving people with a lot more disposable income to stimulate the economy. Describing the couple’s payback strategy over coffee at McDonald’s, Mark sounded like an addict self-administering a reduction cure: they taper down the quantity re-borrowed each and every month, pay it in full, and combine their GST cheque with cash borrowed from their households ultimately to spend off the debt totally.

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