Aquinum's Razor - All Comments

re: Cause of Today's Economic Crises: Too Much Thrift

Jeff — Thu, 25 Mar 2010 11:23:29 GMT

"Transfer (sale of) of treasury debt to external entities will only become a problem when the United States dollar stops acting like a global currency."

But what happens if there is not any more global demand for T-Bills as a reserve capacity for other nations? Interest rates go up and the FED eventually holds all of our debt. At some point the interest level of the debt will be so high that debasement of the currency will be astronomical.

"Falling asset prices does not mean that our ability to produce real goods and services is diminishing."

But it does seem to suggest that there is not demand to buy the goods and services produced by those assets and make a profit. Its really bad for those who own rental property and they can't rent for enough to pay the note. The market price of an asset is not an accounting trick but a representation of potential profit/loss for a given project.

re: Cause of Today's Economic Crises: Too Much Thrift

Jeff — Thu, 25 Mar 2010 11:22:15 GMT

"Transfer (sale of) of treasury debt to external entities will only become a problem when the United States dollar stops acting like a global currency."

"Falling asset prices does not mean that our ability to produce real goods and services is diminishing."