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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (29400)	3/25/2005 5:54:07 PM
From: mishedlo	Read Replies (2) \| Respond to of 110194

To anticipate deflationists' objections, this process has nothing to do with wages, economic growth, or retail demand. Even with a drastic drop in employment and collapsing retail sales, a large government that pays its bills with freshly-printed fiat currency can and will produce inflation, which is merely currency depreciation. He is dead wrong. It is about jobs because without them people can not pay their bills, housing crashes and MONEY is destroyed in mass. He is dead wrong. Mish

To: russwinter who wrote (29400)	3/25/2005 5:54:46 PM
From: CalculatedRisk	Read Replies (1) \| Respond to of 110194

russ, I agree with the general thrust of that commentary (too much debt), but his numbers are not quite correct. The FED "Flow of Funds" report shows $37 Trillion in debt, but some of it is double counted. Here is what I get (Billions): Government Debt: Federal $4317 Trust Fund $3200 State $1670 TOTAL Government $9187 Household Debt: Mortgage $7261 Consumer Credit $2124 TOTAL Household $9949 (includes some small items) Business Debt: $7671 Financial Sectors: $11,674 TOTAL DEBT: ~$38 Trillion. GDP rate (based on Q4, 2004) is $11,967 Billion. The Financial Sectors debt is primarily for intermediation so it is probably double counted. I would think $27 or so Trillion would be the correct number. The debt situation is not a pretty picture, but it is not as bad as Mr Radley's commentary would portray.

To: russwinter who wrote (29400)	3/25/2005 5:56:02 PM
From: CalculatedRisk	Respond to of 110194

Russ, you might enjoy this too! Free Money! calculatedrisk.blogspot.com RE is too funny right now.