Reinko

BOJ Foot Dragging Continues to Exert Upward Pressure on Japan's Bond Yields

I agree with the first comment:

The USA is heading towards a full decade long ZIRP system.

But the link posted at the end of the comment uses thousands and thousands of words and a lot of graphs that are not needed.

It's all pretty simple:

If average interest rates are about 5% and total debts inside an economy are 300% of the yearly gross domestic product, in that case 15% of the gross domestic product is needed to 'service the debt' (that means paying for the interest).

The USA has above 350% of debt on herself, so an average interest ratio of 5% would very soon lead to a complete and utter bankruptcy of the entire USA.

Simply because serving the interest is above the combined profits of the entire USA.

It is all so simple, why need thousands and thousands of words to arrive at this conclusion?????

Beats me...

As far as Japan is concerned, they have higher saving rates compared to the USA but their economy is not suited to survive when the USA finally defaults.
Poor poor Japs.