The public debt held by the central bank is a zero-coupon perpetuity, so it is time to stop the fruitless debates

The public debate in France on public debt has become very chaotic: some are calling for the cancellation of the "COVID debt", others want to transform it into perpetual debt, others want to "ring-fence" it to separate it from the rest of the public debt. These fruitless debates will cease once it is understood that the public debt held by the central bank is a "zero-coupon perpetuity": It is free of charge, whatever the level of interest rates, since the central bank returns its profits to the government; It will be rolled over at maturity indefinitely, given the excessive risk of triggering another public debt crisis in the euro zone if the ECB ever decides to reduce the size of its balance sheet. A zero-coupon perpetuity obviously does not need to be cancelled, or converted into perpetual debt, or ring-fence d. The current status quo is by far the most favourable situation for the euro-zone countries.