Monday, 25 July 2011
Here is Who Owns the $14 Trillion US Debt
While Washington is bogged down in how to raise the US debt ceiling, people around the world are asking questions like "who owns this debt?". The Atlantic has a graph answering this question. More than half of the total national debt is owed to the US Federal Reserve. Debt owed to a country's own citizens is not as big a problem as debt owed to foreigners.
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Very informative. The public discourse illustrates the inability to differentiate between the various forms of debt but the lump that is considered debt has trumped employment. Interesting piece from Globe & Mail highlighting the viewpoints of Summers vs. Reinhart & Rogoff:
ReplyDeletehttp://www.theglobeandmail.com/report-on-business/economy/beyond-debt-debate-jobs-crisis-looms/article2108046/
Moreover, the role of credit in the economy is undermined and that is why I see the Japanese disease as a greater risk now, particularly absent any fiscal intervention. The only intervention that is popular amongst the Washington elites is military.
A good article from the Globe & Mail. So, the choices are:
ReplyDelete1. spend money to create jobs.
2. cut debt and reduce job creation.
3. get used to slow, sluggish US growth.
I see option 1 as the only real hope. Options 2 and 3 are likely to play out like Japan's L shaped recovery.