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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Don Lloyd who wrote (71414)	12/3/1999 3:45:00 PM
From: Freedom Fighter	Respond to of 132070

Don, >>If actual business conditions aren't the problem, holding debt as inflation picks up is not a problem as you can repay with cheaper dollars.<< Holding the debt would not be an issue. Coming up with the incremental capital to keep the balance sheet looking the same might be. (50-50) If I hold 1M in debt instead of 500k, the incremental demand for capital on an aggregate basis might cause higher interest rates regardless of whether the creditors know what the real inflation rate is or not. Not for credit worthiness reasons, but simply because of the supply of available savings relative to the demand for credit. Clearly I need to think about this some more, but I think there is something here. I'm just not sure what. (g) Wayne