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To: patron_anejo_por_favor who wrote (179020)	7/10/2002 11:49:50 PM
From: Activatecard	Respond to of 436258

Interesting observation the U.S. private sector debt alone is over 280% of GDP," Russell's reader explains, "and is the largest debt pile in world economic history. The U.S. telecom sector alone has more debt than the entire Japanese property sector did or has." "In the first quarter of 2002, consumers borrowed at an annual rate of $695 billion - breaking all previous records," Dr. Richebacher elaborates. "Their incomes, on the other hand, rose at an annual rate of only $110 billion. And for the 12 months ending in April of this year, $5.9 dollars of debt was added for every $1 of growth in GDP." Adding debt to the system is inflationary: there is the illusion of greater purchasing power, which boosts up whatever market is hot at the time. Stocks went up in the '80s and '90s; now real estate is having its turn. If only it could continue forever! Alas, that is not the way of the world. For each additional dollar of debt produces less and less economic progress...and is therefore a heavier burden than the dollar that preceded it. At some point, people realize that they cannot afford to continue borrowing - their debt-service payments have become too much of a burden. Instead, they have to cut expenses and pay down debt. Then, prices fall...sales go down...jobs are lost...and the economy sinks into a deflationary recession. This, of course, has been the economic history of Japan for the last 10 years. More to come... Bill Bonner