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  • More Debt, Less Filling [View article]
    Crocodilian,

    Private debt is contracting because people are losing their jobs and/or afraid of same. The FY 2009 US Federal deficit is estimated to be $1.2 Trillion, not counting any stimulus package, in part because tax revenues are down vs projected caused by the economic fall.

    So why do Treasury buyers have confidence in the US government's ability to pay off debt? Deficits are historic and rising with no end in sight. Maybe they're not thinking it through. Where will the tax revenues come from to pay off these new Treasuries? There may be a current surge in demand for "public debt" but I believe it is short-sighted. Yes, all that money fleeing stocks has to go somewhere. I am starting to think that it is rolling around the gun deck like a loose cannon.
    Jan 09 10:48 am |Rating: +2 -1
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