Home › Forums › Financial Markets/Economics › The Bipartisan March to Fiscal Madness
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bearishgurl.
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April 25, 2011 at 11:12 PM #689237April 25, 2011 at 11:27 PM #690358
sreeb
Participant[quote=urbanrealtor]
If we ever really had a problem paying on those bonds we could just literally print the cash and mail it to the bond holders.[/quote]This is step one on the path to hyperinflation. It has been done many times in the past but I don’t think you can point to a single case where it had a good result.
You can do it but not without consequences.
April 25, 2011 at 11:27 PM #689184Participant[quote=urbanrealtor]
If we ever really had a problem paying on those bonds we could just literally print the cash and mail it to the bond holders.[/quote]This is step one on the path to hyperinflation. It has been done many times in the past but I don’t think you can point to a single case where it had a good result.
You can do it but not without consequences.
April 25, 2011 at 11:27 PM #689247Participant[quote=urbanrealtor]
If we ever really had a problem paying on those bonds we could just literally print the cash and mail it to the bond holders.[/quote]This is step one on the path to hyperinflation. It has been done many times in the past but I don’t think you can point to a single case where it had a good result.
You can do it but not without consequences.
April 25, 2011 at 11:27 PM #690006Participant[quote=urbanrealtor]
If we ever really had a problem paying on those bonds we could just literally print the cash and mail it to the bond holders.[/quote]This is step one on the path to hyperinflation. It has been done many times in the past but I don’t think you can point to a single case where it had a good result.
You can do it but not without consequences.
April 25, 2011 at 11:27 PM #689863Participant[quote=urbanrealtor]
If we ever really had a problem paying on those bonds we could just literally print the cash and mail it to the bond holders.[/quote]This is step one on the path to hyperinflation. It has been done many times in the past but I don’t think you can point to a single case where it had a good result.
You can do it but not without consequences.
April 26, 2011 at 12:09 AM #689253Participant[quote=urbanrealtor]
The problem with us “becoming Greece” is that all of Greece’s debt was externally denominated.
[/quote]That is not really correct in the sense it is for say Hungary since Greece is a member of the EMU and the EURO is their internal currency.
I agree that we have the option to devalue our currency and they don’t. I don’t agree that this is a painless solution to any of our problems.
The fundamental problem Greece has is that their interest rates are now much higher than their economies growth rate so their debt continually grows in relation to their ability to pay. They are running large deficits which also accumlate to their debt. Further, they need to continually refinance their debt at higher rates as it comes due which increases their deficits.
Most americans have a certain arrogance with regard to the dollar that leads them to believe it will be trusted world wide no matter how many we print, how big our debt grows, or how big a deficit we run. All past experience has shown it to be (almost) as good as gold and it will continue to be until there is a loss of confidence.
I don’t expect the next few years to be too confidence inspiring.
April 26, 2011 at 12:09 AM #689189Participant[quote=urbanrealtor]
The problem with us “becoming Greece” is that all of Greece’s debt was externally denominated.
[/quote]That is not really correct in the sense it is for say Hungary since Greece is a member of the EMU and the EURO is their internal currency.
I agree that we have the option to devalue our currency and they don’t. I don’t agree that this is a painless solution to any of our problems.
The fundamental problem Greece has is that their interest rates are now much higher than their economies growth rate so their debt continually grows in relation to their ability to pay. They are running large deficits which also accumlate to their debt. Further, they need to continually refinance their debt at higher rates as it comes due which increases their deficits.
Most americans have a certain arrogance with regard to the dollar that leads them to believe it will be trusted world wide no matter how many we print, how big our debt grows, or how big a deficit we run. All past experience has shown it to be (almost) as good as gold and it will continue to be until there is a loss of confidence.
I don’t expect the next few years to be too confidence inspiring.
April 26, 2011 at 12:09 AM #690363Participant[quote=urbanrealtor]
The problem with us “becoming Greece” is that all of Greece’s debt was externally denominated.
[/quote]That is not really correct in the sense it is for say Hungary since Greece is a member of the EMU and the EURO is their internal currency.
I agree that we have the option to devalue our currency and they don’t. I don’t agree that this is a painless solution to any of our problems.
The fundamental problem Greece has is that their interest rates are now much higher than their economies growth rate so their debt continually grows in relation to their ability to pay. They are running large deficits which also accumlate to their debt. Further, they need to continually refinance their debt at higher rates as it comes due which increases their deficits.
Most americans have a certain arrogance with regard to the dollar that leads them to believe it will be trusted world wide no matter how many we print, how big our debt grows, or how big a deficit we run. All past experience has shown it to be (almost) as good as gold and it will continue to be until there is a loss of confidence.
I don’t expect the next few years to be too confidence inspiring.
April 26, 2011 at 12:09 AM #690011Participant[quote=urbanrealtor]
The problem with us “becoming Greece” is that all of Greece’s debt was externally denominated.
[/quote]That is not really correct in the sense it is for say Hungary since Greece is a member of the EMU and the EURO is their internal currency.
I agree that we have the option to devalue our currency and they don’t. I don’t agree that this is a painless solution to any of our problems.
The fundamental problem Greece has is that their interest rates are now much higher than their economies growth rate so their debt continually grows in relation to their ability to pay. They are running large deficits which also accumlate to their debt. Further, they need to continually refinance their debt at higher rates as it comes due which increases their deficits.
Most americans have a certain arrogance with regard to the dollar that leads them to believe it will be trusted world wide no matter how many we print, how big our debt grows, or how big a deficit we run. All past experience has shown it to be (almost) as good as gold and it will continue to be until there is a loss of confidence.
I don’t expect the next few years to be too confidence inspiring.
April 26, 2011 at 12:09 AM #689868Participant[quote=urbanrealtor]
The problem with us “becoming Greece” is that all of Greece’s debt was externally denominated.
[/quote]That is not really correct in the sense it is for say Hungary since Greece is a member of the EMU and the EURO is their internal currency.
I agree that we have the option to devalue our currency and they don’t. I don’t agree that this is a painless solution to any of our problems.
The fundamental problem Greece has is that their interest rates are now much higher than their economies growth rate so their debt continually grows in relation to their ability to pay. They are running large deficits which also accumlate to their debt. Further, they need to continually refinance their debt at higher rates as it comes due which increases their deficits.
Most americans have a certain arrogance with regard to the dollar that leads them to believe it will be trusted world wide no matter how many we print, how big our debt grows, or how big a deficit we run. All past experience has shown it to be (almost) as good as gold and it will continue to be until there is a loss of confidence.
I don’t expect the next few years to be too confidence inspiring.
April 26, 2011 at 7:07 AM #690383zk
ParticipantI always like to hear as many sides to an argument as I can. Here is, from what I can tell from his very-poorly-presented case, a contrary view:
That’s Oppenheimer Asset Management’s chief investment strategist.I’d be interested to hear what more knowledgeable people than me have to say about his ideas.
April 26, 2011 at 7:07 AM #689209ParticipantI always like to hear as many sides to an argument as I can. Here is, from what I can tell from his very-poorly-presented case, a contrary view:
That’s Oppenheimer Asset Management’s chief investment strategist.I’d be interested to hear what more knowledgeable people than me have to say about his ideas.
April 26, 2011 at 7:07 AM #689888ParticipantI always like to hear as many sides to an argument as I can. Here is, from what I can tell from his very-poorly-presented case, a contrary view:
That’s Oppenheimer Asset Management’s chief investment strategist.I’d be interested to hear what more knowledgeable people than me have to say about his ideas.
April 26, 2011 at 7:07 AM #689273ParticipantI always like to hear as many sides to an argument as I can. Here is, from what I can tell from his very-poorly-presented case, a contrary view:
That’s Oppenheimer Asset Management’s chief investment strategist.I’d be interested to hear what more knowledgeable people than me have to say about his ideas.
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