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Started by IQ76again on Jun 6, 2020 7:16:18 AM
Is there a limit to borrow

With a good times you take 1 trillion a year more debt and with times like this you take 4 trillion more debt.

Is it sustainable in long howl?

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IQ76again - 06 Jun 2020 07:31:13 (#1 of 27)

Jordan giving 100 million for fighting against racsism is a good start.

widenation - 06 Jun 2020 07:36:46 (#2 of 27)

Long Howl?

IQ76again - 06 Jun 2020 07:38:58 (#3 of 27)

10 year or 100 year perspective.

It is a lot of debt to handle.

IQ76again - 06 Jun 2020 07:45:31 (#4 of 27)

US have debt so far is

https://www.usdebtclock.org/

and that is more than yearly GDP and that is way more than any countries of northern europe.

widenation - 06 Jun 2020 07:47:30 (#5 of 27)

Ah, long haul.

kvelertak - 06 Jun 2020 07:57:18 (#6 of 27)

Deserves a response in the style of Allen Ginsberg.

kvelertak - 06 Jun 2020 08:00:19 (#7 of 27)

I saw the economists of my generation destroyed by madness, starving hysterical naked, dragging themselves through Wall Street at dawn looking for an angry fix...

Arjuna - 06 Jun 2020 08:06:11 (#8 of 27)

Just depends on what people will lend and what the rate of interest is

In 1796 Britain was at war with revolutionary France and was running up huge levels of debt. Thomas Paine wrote a pamphlet called "The Decline and Fall of the English System of Finance" detailing a pattern of increasing public debt over the previous century. He predicted immanent collapse but Britain fought wars with France for nearly 20 years even subsidizing allies. At the end, it's debts were twice the national income.

IQ76again - 06 Jun 2020 08:14:52 (#9 of 27)

Just depends on what people will lend and what the rate of interest is

When interest is low, like now, you recommend more debt?

CarlosFandango - 06 Jun 2020 08:20:56 (#10 of 27)

Neither a borrower nor a lender be

Fiddledediddledediddlededee

Polonius for Chairman of the Federal Reserve.

Arjuna - 06 Jun 2020 08:31:22 (#11 of 27)

When interest is low, like now, you recommend more debt

Not recommend it but it does make it easier to pay

IQ76again - 06 Jun 2020 08:36:28 (#12 of 27)

It is funny that European countries pay way less for their debt than US does. It makes some sense because US have more debt than EU in average.

IQ76again - 06 Jun 2020 08:51:44 (#13 of 27)

Ah, long haul.

Not everyone is speaking english as their first language. I just hope you understand what I am saying, that is more than enough for me.

kvelertak - 06 Jun 2020 08:52:33 (#14 of 27)

You do fine, IQ.

pranzingfrogg - 06 Jun 2020 16:07:37 (#15 of 27)

Given the administrations in both UK and USA just now, “long howl” seems apposite.

tasselhoff - 06 Jun 2020 16:11:00 (#16 of 27)

Increasing public and private debt are both a byproduct of our credit-based broad money system. The only way of [cont. p94].

dreams99 - 06 Jun 2020 16:16:13 (#17 of 27)

It is funny that European countries pay way less for their debt than US does.

Based on? The US government's debt is $25trn and its annual interest costs are $500bn, so 2% on average and declining, as new debt is being issued at rock bottom rates.

UK govt debt is £1.6trn and interest is just over £41bn, so about 2.5%.

The US will always have lower interest costs than most because the dollar is a reserve currency, so people, companies and governments all round the world want safe assets denominated in dollars.

brooklyn - 06 Jun 2020 16:25:28 (#18 of 27)

the usual response to "you can't borrow that much" is "look at history."

which is to say, if the economy keeps growing like gangbusters, then the staggering debt of today becomes manageable debt at a smaller %% of GNP tomorrow.

it worked, for example, after WW II, for which we took on an incredibly massive debt load. many predicted we would have to default on that debt. but then the economy boomed, and suddenly the debt didn't look so big anymore.

the gamble is that this will happen again. the problem is, as they say, "past results are no guarantee of future performance." after WW II, economically speaking, we bestrode the world like a colossus. today, not so much.

tasselhoff - 06 Jun 2020 16:27:54 (#19 of 27)

Also, limits to growth.

IQ76again - 06 Jun 2020 16:48:04 (#20 of 27)

Based on? The US government's debt is $25trn and its annual interest costs are $500bn, so 2% on average and declining, as new debt is being issued at rock bottom rates.

UK govt debt is £1.6trn and interest is just over £41bn, so about 2.5%.

The US will always have lower interest costs than most because the dollar is a reserve currency, so people, companies and governments all round the world want safe assets denominated in dollars.

Finland state seems to get a new loan below 0% interest with Germany, so people will pay us for a privilege to give us money.

Yes, it is weird.

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