Tuesday, May 15, 2018

Inflationary devaluation fails

The Output Gap, the Federal Budget Deficit, and the Threat of Debt Monetization

The federal government holds inflation insurance almost everywhere. Any attempt to inflate the debt away fails, government expenditures forced up faster than tax growth.

How does default help? Not much, really, but default can be an opportunistic process, allowing government accounting to evolve and adapt.  Sandbox allows this, hence if no sandbox, the American finance system fails.  Sandboxers control the situation.

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