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When economists talk about stocks and flows of money, they are essentially adding time to the equation.

A flow is a quantity of money measured over a given time period. For example, the Government deficit is a flow, typically measured over a quarter or a year.

The Government debt is a stock, which is the cumulative total of Government deficits. In this way, the deficits accumulate to become the debt. So we say flows accumulate to stocks.

One common measure we frequently see is the Debt to GDP ratio. In my opinion, this is a difficult ratio to draw meaningful conclusions from because it compares a stock to a flow. Presumably a high debt to gdp ratio is bad because it means you are getting less productivity out of each dollar of debt. However, it could also mean that the population has a high amount of savings relative to economic activity. Not necessarily a bad thing.

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