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You should read The Economics of Innocent Fraud. http://www.amazon.co.uk/Economics-Innocent-Fraud-Pocket-Peng...

>Whatever they don't consume is reinvested in the economy.

This is true of all financial transactions. The question is, are resources being allocated efficiently? As the authors state - that 5 trillion is not going to build schools or hospitals.

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As the authors state - that 5 trillion is not going to build schools or hospitals.

It's almost certain that some chunk of it is being spent on (for-profit) hospitals and schools. But you are correct - some it is is spent on automotive manufacturing, telecom infrastructure, heavy equipment producers, sporting goods, etc.

Is there some reason to believe that schools and hospitals is a better use of the money than these other projects?

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