This episode of "Ones and Tooze" discusses two major economic events: Germany's decision to significantly increase government spending, particularly on military and infrastructure, and the implications of the substantial US budget deficit. The hosts analyze the political maneuvering behind Germany's decision, highlighting the unusual use of the old parliament to pass the constitutional change enabling increased spending. The discussion then shifts to the US deficit, examining the different types of debt holders and their potential impact on market stability, concluding that while a debt crisis is possible, the US Federal Reserve has the capacity to intervene. A key takeaway is that the German government's actions represent a significant shift towards European autonomy in defense, while the US faces challenges related to its massive debt and potential political instability. The podcast provides insights into the complexities of international finance and the interplay between politics and economics.
