Monday, November 23, 2009

Our Economic Mess

These charts are a bit disconcerting. From Soc Gen Research via Business Insider:

Debt is exploding, while government revenue is starting to drift violently downward
Now lets look at household debt. We're nowhere back to near normal
So savings could go a lot, lot higher. Perhaps 8%.
Basically, our options for debt include default, inflation, and actual growth.

If the three possible options for dealing with the high Debt/GDP ratio are inflation, default and/or growth, which are most likely? This administration is doing absolutely NOTHING to encourage growth. If you owned or were thinking about starting a business, would you be likely to take the risk given the deluge of new taxes coming your way from health care, payroll, and cap and trade? With gold surging to $1,150/oz., I think that the goal of the administration is to inflate our way out of this mess.




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