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Ultimately, it could crowd out private borrowing.
In Latvia about 90% of all private borrowing is.
A weak economy will discourage much private borrowing.
Public and private borrowing has become a way of life.
Portfolio rebalancing could bring down private borrowing costs.
What gets tricky here is the question of whether private borrowing costs rise in tandem.
Government borrowing doesn't crowd out private borrowing, it puts idle funds to work.
It will be very difficult to encourage private borrowing amid such substantial cutbacks.
The rich world is short of private borrowing and awash with saving.
Moreover, most private borrowing is in euros, so devaluation would mean beggary for many.
The deep freeze in private borrowing has begun to thaw, too.
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