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Pastimes : The Philosophical Porch -- Ignore unavailable to you. Want to Upgrade?

To: Investor2 who wrote (6040)	9/26/2010 6:38:39 AM
From: westpacific	Read Replies (1) \| Respond to of 26251

Downright radical... In a short 24 months, federal debt has jumped from 46% to 71% of GDP. The Government Finance Bubble thesis holds that government debt is the latest - and greatest - episode of Hyman Minsky's "Ponzi Finance." During Q2, the markets accommodated a $2.0 Trillion annualized pace of federal debt growth. In just eight quarters, federal government debt expanded $3.610 TN, or 54%, to $10.308 TN. In a short 24 months, federal debt has jumped from 46% to 71% of GDP. And as long as the markets allow such unprecedented issuance of non-productive Credit at historically low yields, it's quite possible that household incomes, corporate earnings, the general economy, and the securities markets might appear ok. Heck, Washington seems awfully determined to resuscitate asset prices. But we don't have to look back too many quarters for a stark reminder of the nature of Ponzi Dynamics and Fragilities. safehaven.com