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Politics : Stockman Scott's Political Debate Porch
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To: American Spirit who wrote (11317)1/8/2003 4:57:44 PM
From: Freedom Fighter  Read Replies (1) of 89467
 
>If Greenspan could create a bubble he'd create one now.<

All pyramid schemes eventually get too large to continue. That is essentially what a credit bubble is. As long as ever larger increases of easy credit are available, the economy, asset prices or where ever it is directed will expand. At a certain point though, the numbers get so huge that interest rates have to fall so much it just can't be sustained. Worse, is that sooner or later people figure out what's going on and they abandon the inflated areas, the excesses fail to produce enough income to support the accumulated debt, the currency collapses etc....
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