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"
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
of the American people "
to govern fiscal deficits
Posted by Owen Paine at 12:50 PM