Large debt crises. Principles of overcoming

The book shows a template that clarifies how all debt crises occur, and the basic principles of overcoming them are formulated.

It is difficult to evaluate loans as "good" or "bad", because development in the economic sphere most often occurs precisely due to money borrowed. If the economic benefit of using borrowed funds is sufficient to return the money, this is good. If lending conditions rigidly require guaranteed debt payment with interest, then there will be less loans and development will slow down. If the conditions are more flexible, this contributes to greater development, but it can create serious problems that will cross out all the benefits created: the “bubble” will form in the economy.

Bridgewater has done a huge work on a retrospective analysis of debt crises of different states. This analysis helped to realize their causal relationships, highlight several archetypes of the crisis and develop the principles of successful overcoming for everyone