In an article by Jean-Michel Naulot about the 2007–2008 financial crisis, I read (my translation):
Although central banks had an exemplary reaction at the time of the [2007–2008] crisis, they subsequently carried out an unprecedented policy by massively and durably injecting currency into the financial system, as never before. A major part of these liquid assets was invested into risky assets and speculation. Private debt rose considerably again.
In the past 20 years, a fiendish debt feedback system has risen: as crises break, public spending is massively revived and tax revenue is reduced, hence public debt soars. Central banks keep interest rates low for extended periods of time and private debt rises considerably, especially in countries with high levels of inequality. Excessive private debt leads to a new crises, which drives public debt up, ...
The second paragraph suggests that public debt rises because of public spending programs and because lower tax revenue during hard times is not compensated by higher tax revenue during boom times. However the first paragraph suggests that there's more to public debt than public works (which benefits the public) and low taxes (which benefits whoever gets low tax rates). Where does the money that's “massively and durably injected” go?
Does this refer to stimulus packages? To governments compensating for defaulting financial institutions? Who's getting the money? Are these loans (that don't seem to be repaid) or gifts?