Tuesday, August 24, 2010

Kling and a sovereign debt crisis

He has a paper on the subject, we should all try to read it.  I am taking his advice to read it at least twice.

As usual, I present my theory first.  We will have a sovereign debt crisis when the integrated area of the treasury yield curve drops below our biologically determined signal to noise ratio.  We will notice when treasury growth stays below potential growth for an extended period.

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