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back in 2005 !!!!!!!!!!!!!!!!!!!!!
http://www.economist.com/node/21555564
Drink deeply from the well of nothingless Limey scum....
http://www.economist.com/node/21555564
Drink deeply from the well of nothingless Limey scum....
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Re: Mega was right it seems.....
I notice that whenever one of these "we've got to be realistic" arguments is made, the author never recommends that debt be marked to market. So while workers' "dreams of affluence for life" are to be replaced with nightmares, those whose wealth is measured in mark to fantasy debt are apparently allowed to dream on.
The value of all debt is merely a discounted measure of all future cash flows to be paid the holder of that debt. If those cash flows are at all dependent on workers' real wages, consumption, health and mean age, then any decline in workers' real wages, consumption, health and mean age must logically cause a decline in the value of that debt. This is particularly true at the zero bound, when it no longer becomes possible to lower the discount rate used to determine the debt's value.
Instead, we are told that the debts must be paid in full from declining real wages, consumption and health over a time period when the mean age of the work force has passed its most productive years.
Of course, this is as it has always been. The creditor class will squeeze the debtor class to worker harder and longer to maintain the creditors' income. This will go on as long as the debtor class allows it.
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