And even this modest goal presumes that economies are able to grow faster than their debt – in real terms. When you get debt equal to 100% of GDP, you’re over a barrel. If interest rates were to return to the double digit levels of the ’70s, it could cost more than 10% of GDP just to pay the interest.
June 30th, 2010 | Bill Bonner | 0 comments | ContinuedAll Posts Tagged With: "geithner"
G20, Airlines and Transport
But don’t worry, boys, sometimes failure is the best you can hope for. And come to think of it…defeat is not so bad. Think how much better off the Chinese would have been if Mao’s long march had ended in the total collapse of his army. And suppose George W. Bush hadn’t been such a total failure? People might not have elected Barack Obama.
June 29th, 2010 | Bill Bonner | 0 comments | Continued
A Funky, Junky Economy
Yes, dear reader, now our leaders are called upon to solve problems that they are not equipped to solve. They are not prepared for the challenge. They cannot do it. Even the best minds in the world are stumped.
June 9th, 2010 | Bill Bonner | 1 comment | Continued
Volatility in the Police State
Stocks trade around 20 times earnings now…and the Dow is about 10 times the price of gold. Sometime in the future, you’ll probably be able to buy Dow stocks at 5 times earnings and maybe only 1 times the price of gold. Three thousand seems like a likely target, because that would move stock prices down into the right range from a P/E standpoint…
May 6th, 2010 | Bill Bonner | 6 comments | Continued
Why Else Would Anyone Lend the Feds Money or Back their Health Care Bill?
Yes, we’re expected to believe that the bad news bears – Bernanke, Summers, Geithner et al – have now won the World Series…by not only preventing a depression…
March 31st, 2010 | Bill Bonner | 2 comments | Continued
Geithner Says it Would Take a “Long Time” to Repair the Housing Market
Some wait for the housing market to ‘recover.’ Some may imagine that they will once again see profits from their houses. Others just hold on…
March 29th, 2010 | Bill Bonner | 1 comment | Continued
Australians More Interested in Investing in Property than on Stock Market
You’ll pardon the sense of inevitability in today’s Daily Reckoning. After all it’s raining. But even so, with over $1 billion in Melbourne property clearing auctions this week (at a clearance rate of 86%) it definitely feels like Australians have found a way to hasten their own financial day of reckoning. Of course not everyone agrees.
March 29th, 2010 | Dan Denning | 45 comments | Continued
Occurences Within Economy Consistent With a Depression
“How can you keep talking about a depression,” asks a Dear Reader, “when the economy is clearly recovering just as it should be.”
February 24th, 2010 | Bill Bonner | 10 comments | Continued
Will Bailing Out the Greeks Really Make American Businesses More Profitable?
Bailing out the Greeks is a big mistake. But it’s a mistake everyone seems to want to make. There’s probably a Latin dictum for this sort of thing.
February 15th, 2010 | Bill Bonner | 0 comments | Continued
Here Comes More Snow!
Snowmageddon has paralyzed the nation’s capitol. Once again, the feds announced that only ‘emergency workers’ had to report to work. And once again, we wondered about all the rest.
February 10th, 2010 | Bill Bonner | 0 comments | Continued
If Market Keeps this Way, There May Be More Beaten Down Stocks
It’s quickly becoming a market where you’re worried more about the preservation of your capital rather than capital appreciation or even dividends. Late last night we read the latest monthly report from Australian Wealth Gameplan, edited by Kris Sayce. Kris has come up with a way to hedge against the falling Aussie dollar and listed all the collateral damage that would occur if the currency falls more.
February 9th, 2010 | Dan Denning | 11 comments | Continued
Geithner to Explain to Congress How US Bailed Out AIG
Of course, the Secretary of the Treasury will have answers. He’s been rehearsing them for weeks. He’ll explain that the integrity of the system was at stake…etc…etc… Blah…blah.
January 28th, 2010 | Bill Bonner | 0 comments | Continued
Credit Default Swap: Buying Insurance Against Default in Your Bonds
While Australians march down the path of a national house price obsession/mania, the world’s bond traders are firing warning shots. Bloomberg reports that, “Credit default swap (CDS) protection buying against sovereign debt default has spiked to five times the level of similar protection bought for corporate bonds, as the potential for a wave of sovereign debt defaults intensifies.”
January 28th, 2010 | Dan Denning | 6 comments | Continued
Power Begets Gold, then Gold Begets Power
As near as we can tell, gold is fairly priced. It will buy about as much as it would have bought 500 years ago…or 2,000 years ago, for that matter.
December 23rd, 2009 | Bill Bonner | 1 comment | Continued
Federal Housing Administration Encourages More Bad Mortgage Loans
You’d think the feds might have learned their lesson. Their low rates…and subsidized mortgage loans…led to the biggest bubble in housing in US history.
November 26th, 2009 | Bill Bonner | 0 comments | Continued
