Debt: A Ticking Time Bomb

Financial conundrum: Pakistan needs to declare an economic emergency

Pakistan’s GDP growth has been the lowest in the South Asian region since 2008. The core cause of the crippled economic growth has been the massive financial indiscipline of the current financial managers. The fiscal deficit (as a % of GDP) has been constantly above 6% since 2008. The government has been funding the ever growing deficit by Debt and printing money.

The increasing demand of the government to fund its deficits have resulted in a total debt of Rs10 trillion (up from Rs5 trillion in 2007). The data released by the State Bank of Pakistan indicates that broad money supply growth (M2) has averaged 11.5% over the past three years.

Like I have been saying: reckless spending fueling more debt is eventually going to catch up with each country...it's just a matter of time.  Until then, perhaps we can realize the power and joy of living within our means.  As we model this principal, we have credibility to call on our government to do likewise.  This becomes a powerful argument for limited spending, limited programs and therefore: limited government.

P.S Seriously, no pun intended with respect to bombs and Pakistan...it sounded like a catchy title. Uh, no pun intended with catch, Pakistan and Bin-laden...