Ball & Chain

Discussion in 'Economy' started by DamnYankee, Jun 21, 2009.

  1. DamnYankee

    DamnYankee No Neg Policy

    Apr 2, 2009
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    They wrote about about four key concerns in the March 2007 book, Financial Armageddon --they are:

    Debt, the retirement system, government guarantees, and derivatives -- all, in fact, are closely related. Taken together, they represent claims on our economy that far exceed the resources available to cover them.

    Yet despite the fact that this exposure has already triggered one of history's worst financial crises, as well as the first global downturn since World War II, many so-called experts and policymakers don't seem to have learned from past mistakes. Instead, they believe that taking on many more liabilities than we already have is the only way to get us out of the mess we are in. Kind of like.... the way to eliminate skin grafts is to put your hand back onto the stove.

    Pretty scary, eh?

    Anyway, for a more rational assessment of the risks of borrowing one's way to prosperity, I refer you to a post by Paul Kedrosky at Infectious Greed, entitled, "The Big Bill: Debt and Developed Countries," which provides a succinct summary of an unsettling report.

    The current cover of The Economist is awfully on-point, with a giant ball and chain attached to a crawling baby. It is, of course, the debt bill faced by the developed world, which is the biggest in history.

    continued here

    Financial Armageddon: Ball and Chain

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