Definition of the term default, what it consists of, how it occurs, what it means in economic terms and time frames to predict it.
Meaning of default
In the IT field, the term default means the default setting of an operating system or program if the user does not give specific instructions.
In the economic sector, on the other hand, the word default indicates the serious financial crisis of a physical entity, company or state with red accounts, i.e. the impossibility of meeting commitments to honor their debts towards creditors , resulting in filing for bankruptcy.
If it is a nation that is in default, this causes important repercussions in the entire social fabric, from the failure to pay salaries to state employees, to the progressive interruption of the services to be provided to the community.
Financial markets represent the thermometer for measuring a country's risk, the assessment integrates both the assessment of the trend of internal production, or the GDP, and, more importantly, the trust that foreign investors give to that country, behavior that it can make good or bad weather in the economic future of an entire nation, in the worst case an ever greater recessionary spiral can be triggered, above all because of the inability of the government in turn to make important decisions for the safeguarding of public finances, fault corrupt politicians or clowns only attentive to their seats but never aimed at the good of all citizens, as has happened unfortunately in recent decades in Italy.
The alarm bell of the default usually rings 5 years before, we have to deal well in time and take drastic measures to avoid the worst but without ever increasing taxes, having the courage to cut waste and restore confidence in businesses and self-employed workers in a better future to return to invest again.
