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Politics : Politics of Energy -- Ignore unavailable to you. Want to Upgrade?

To: enginer who wrote (5332)	2/26/2009 7:42:40 AM
From: Brumar89	1 Recommendation Respond to of 86352

I'll have to start paying attention to this ratio. When the bid/cover shows rejection of buying new debt from us, the interest rates required to attract new buyers will steadily increase. Then the dollar will really be headed towards the toilet. If we cannot now afford the deficit, how much less at 10 - 12% interest rate to people who know the only source of these ponzi-scheme payments is "printing presses." This is what scares me. The effect of the stimulus bill and the new $410 billion isn't being reflected yet. The spending and the affect on the debt market will come over a period of years.

To: enginer who wrote (5332)	2/26/2009 8:21:10 PM
From: RetiredNow	Read Replies (1) \| Respond to of 86352

The only reason why they aren't worried about inflation and currency issues right now is because the risk of deflation from a downward spiralling economy outweighs the risk of inflation from a weakening currency. In addition, our currency is not weakening, because the rest of the globe is in the shitter too. So our currency is actually experiencing decent demand as a safe haven. Go figure. Anyway, they will start printing money when they can't borrow anymore. One thing is absolutely certain in my mind. We are going to experience massive inflation when the economy starts to recover. It will be like the Carter days, if anyone on this thread is old enough to remember that. Our currency will tank and inflation will be inevitable. Bernanke will have to raise rates like nobody's business to bring inflation under control. Our only hope is that we recover faster than the rest of the world, that we reach budget surpluses fast and start paying off our debt, and that when we have to start raising rates, the economy is doing so well that raising rates doesn't sink it again. That's a lot of ifs.