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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (135039)	7/28/2013 10:05:40 AM
From: John Vosilla	Respond to of 149317

This game goes on until shareholder value becomes extraordinarily diluted, lenders stop lending, and the capital markets refuse to buy any newly issued stock. Then the company folds or is acquired. All of this is similar to what is going on with the US. The US has debt, which we issue to cover the excess of Congress' cash outflows over their inflows. Already, the US has experienced market saturation of US debt, so the Fed has had to step in over the last year to buy 80% and more of all ongoing US debt auctions. This is what is commonly referred to as QE. The US has not company stock, but it does have the US currency, which it creates out of thin air in order to buy up the US debt as part of QE operations. In the process, this finances US deficits, squeezes interest rates to historic lows, and creates inflation in the housing, bond, and stock markets. So it all is an amazing soporific, feel good scenario. This can go on for a very long time. Much longer than most people realize. I wouldn't be surprised if we can keep this up for another 5 years. I would think that is a very possible scenario kicking the can down the road a long time without repurcussions should capacity utilization not shoot up, oil prices not skyrocket and the current slack in labor market not tighten substantially to where it was in 2000 or 2006.