How can we sleep through Debt’s Dangers?

August 26, 2010 19:11

Time to run screaming through the neighborhood. The US is on fire and at least 50% of the people are clueless. We are on the Titanic about to hit the iceberg only this time we know its there and both parties quibble about a few billion dollars here or there as if that will make a difference.

From IBD Editorials


‘On Thursday, Standard & Poor’s said action is needed soon if the U.S. is to keep the much-coveted AAA bond rating that lets the government borrow in global markets at the lowest rates possible.

S&P’s warning came just days after Morgan Stanley asserted that the U.S., along with a number of other developed nations, is likely to default on some debt. Such defaults are “inevitable,” it said, given the growing number of retirees in developed nations who will have to be taken care of by a shrinking pool of workers.’

‘Debt can be a good thing, but in big doses it’s poison. If, as some fear, the U.S. should simply say it can’t pay its debts and default — or do a de facto default by printing money to retire our debt — the consequences would be dire.’

The dollar would implode, and prices for foreign goods — which now make up 15% of our economy — would soar. Private investment would shrink and, along with it, private-sector GDP.’

‘Unless we begin to control spending, we can kiss our American lifestyles goodbye. It’s that simple.’


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