Comments on: Lending Money Below the Inflation Rate http://www.dailyreckoning.com.au/money-below-inflation-rate/2008/05/02/ An independent perspective on the Australian and global investment markets Sun, 08 Nov 2009 10:25:55 -0600 http://wordpress.org/?v=2.8 hourly 1 By: jack Bonner http://www.dailyreckoning.com.au/money-below-inflation-rate/2008/05/02/comment-page-1/#comment-21406 jack Bonner Mon, 05 May 2008 20:50:50 +0000 http://www.dailyreckoning.com.au/?p=2568#comment-21406 Interesting, if not totally insightful. The reason the US Fed government can loan below inflation rates (which are lies) is that the creditor is receiving something in addition to the interest yield. He is getting some security of the return of his money, but foregoing a return on his money. Things must be worse than they appear, if that is possible. Remember controlling printing presses does matter, even to people as smart as Bill Bonner. As for debt levels of various world states, the USA is disgustingly high, but it is not alone in offical profigatacy. In fact, most of the westernize societies have like problems. Why is that? Could it be that trading and currency adjustments are not well aligned? Over consumption should have been impossible, but it was not; the US currency unit remained strong long after it was seen to be declasse'. Why? That question leads to the greater fool theory among producing and consuming countries. Oh well you get the point, or should anyway. Interesting, if not totally insightful. The reason the US Fed government can loan below inflation rates (which are lies) is that the creditor is receiving something in addition to the interest yield. He is getting some security of the return of his money, but foregoing a return on his money. Things must be worse than they appear, if that is possible. Remember controlling printing presses does matter, even to people as smart as Bill Bonner.

As for debt levels of various world states, the USA is disgustingly high, but it is not alone in offical profigatacy. In fact, most of the westernize societies have like problems. Why is that? Could it be that trading and currency adjustments are not well aligned? Over consumption should have been impossible, but it was not; the US currency unit remained strong long after it was seen to be declasse'. Why? That question leads to the greater fool theory among producing and consuming countries. Oh well you get the point, or should anyway.

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