Economic and fiscal policy

One of the main goals of the European Union and one of the reasons for its existence is to achieve economic stability and sustainable growth on the Old Continent. In themselves, these are concepts devoid of particular meaning and without practical value, whose main role is to sound good in political speeches ...

Today, the Bulgarian parliament approved the government's budget update proposal in first reading. The bill envisages an increase in the deficit from the current 1.3%/GDP to 2%/GDP and raising the ceiling for issuing new debt this year from BGN 2 billion to BGN 3 billion.

More than a month of protests involving thousands of people do not seem to bother the ruling party – they not only have no intention of resigning, but also continue to pursue harmful policies. The latest manifestation of this was the update of the state budget. The article will analyze the arguments that justify this move.

The fundamental reason behind these imbalances is the monetary policy of the US central bank – the so-called Federal Reserve (Fed). Increasing the money supply, reducing interest rates and buying government debt lead to excessive consumption, inflation of bubbles and growth of government spending and debt.