Monday, October 18, 2010

If the Debt Cannot Be Sustained, It Won't Be

. Monday, October 18, 2010

Martin Feldstein has a plan for reducing the U.S.'s sovereign debt, in the form of an NBER working paper. I tend to be a believer in Herb Stein's Law on such matters.

That is all.


Emmanuel said...

What, deficits matter now? You mean those poor UNC folks were laid off due to belt tightening in America where it's our currency, your problem?

Whatever happened to the guy who used to write about "intertemporal carry trade" and "[t]hat doesn't mean I support austerity for the U.S. While interest rates remain low we are not in a precarious position, so retrenchment would be foolish."

Welcome to gnarly American reality, son ;-) I guess ol' Erskine Bowles--I think he's got something to do with UNC--at least made some sense.

Kindred Winecoff said...

What are you talking about? I'm pretty blase about the debt... as this post was intended to signify. Feldstein doesn't believe that we should lower deficits now, and neither do I. Why should we, when interest rates are still at near-historic lows? The intertemporal carry trade is still good for the US.^TNX+Interactive#chart2:symbol=^tnx;range=my;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Investors are clearly not as bearish on the US as you are. The US gov't can borrow for 30 years at less than 4% interest. That's... incredible.^TYX&t=my&l=on&z=l&q=l&c=

Emmanuel said...

OK, no worries. I guess Japan should borrow even more than the US since it can borrow for even cheaper. No ill effects from taking on too much debt there.

Like in the UNC system, there's no cause for budgetary concern. Silly me.

If the Debt Cannot Be Sustained, It Won't Be




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