Arthur you're mixing a stock with a flow when you start comparing outstanding debt to GDP. There's no criteria to judge the burden of debt in that way

With 17 trillion dollars of debt trading at negative interest rates the bond market is giving an opposite signal. Namely that deflation is the order of the day. The Bond vigilantes have spoken.

I fully agree with that conclusion.

The reason why interest rates are so low is because there is excessive savings. Germanyand Japan for example have excessive savings even though they havenegative interest rates.. They chose as a nation to produce more more than they consume and export the surplus. The US chose the opposite

This has been going on for decades.

So far the banks have been able to attract deposits. The alternative for safe keeping is short-term government debt which is a near- form of cash.

The longer-term problem is insufficient spending and too much saving which holds back economic growth.

I totally agree. Canadian response was appropriate and within the parameters of responsible fiscal policy. Big question is whether this will be enough, now that the expectations for the winter months are for a significant rise in infection rates, lockdowns and declining economic growth.

There is no criteria to judge whether a central bank holds too much of public debt. The Bank of Japan owns more than 80% of its govt debt. If the debt is serviced, is liquid and can be rolled over readily then ownership is not an issue. Whether individuals or their central bank own the debt is an ideological debate, not a practicable matter in the financials. The issue of debt goes only to the faith that it is serviceable and redeemable

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What will hurt the banks is the competition from fintech companies that are going to bypass the banks payment system. The Canadian banks are way behind the curve on that point.

In both countries though the economic collapse is so deep and wide that government spending has to be at these levels if not higher. Without that the economic hardship would be politically unacceptable.

One unintended consequence of raising rates in response to higher rent costs is the reduction in housing supply which in turn adds to higher rents,

IThe Fed rate is too blunt an instrument to tackke sectoral shifts in costs that supply driven

Low interest rates have not led to weak growth. Instead it is the reverse. Low interest rates are a sign of weakness and present and future earnings. Milton Friedman show this to be true decades ago when he visited Japan and stated that the low interest rates were a reflection of a weak economy. When nterest rates hit zero and the discount rate then is zero. This leads to an absurd discounted cash flow model using is there a discount rate.