A government plans to fund a new national highway system by selling bonds exclusively to its own citizens. An economic commentator claims, 'This action will immediately decrease our nation's total wealth because the country is taking on billions in new debt.' Which statement best evaluates the commentator's claim regarding the immediate impact on aggregate wealth?

A report shows that total mortgage debt held by households in a country increased by $1 trillion over the past year, with all loans originating from domestic banks. This increase in household liabilities necessarily means the country's aggregate wealth has decreased by $1 trillion.

Internal Debt and National Wealth

Analyzing Wealth in a Closed Financial System