Thursday, April 14, 2016

Treasury rates are not too low

Look, what percentage of real goods are set aside as surplus to cover federal interest payments? Seven percent, and that number will not grow.  Take a look, with this economy, we exceed seven percent and we get severe volatility.

But wait, it gets worse.  The deficit has stopped dropping, its now getting worse, so if rates stay the same, the Swamp cannot budget, DC stops working at all.  The central bank has long since used up its resevoir of liquidity, it cannot mark to market as long as the US Senate is a member bank..

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