Saturday, August 2, 2014

more on "zero real"

" real interest rates are expected to be only slightly above growth rates. "
that is a usual way to tip toe past
the  bug a boo of a debt trap

the trap ?

pk again :
"It’s true that if current policies are continued with no change
 we’re highly likely to face an unsustainable fiscal gap"

" ...a gap that can’t go on forever ..."

" if we look far enough..."  ahead . Stein’s Law  applies:

" if something can’t go on forever, it will stop"

". Sooner or later,
 we will have some combination
                               of benefits cuts and/or revenue increases"

yikes !!

but what nonsense !

 nothing prevents the FED from adopting
a "zero real " infinite horizon "safe"
interest rate policy
nothing except ..... wall street
a zero real policy
would uncap public nominal debt
to support any necessary maximum mobilization macronautics
we would rely on
"the discretion
of the American people "
to govern fiscal deficits