Debt To GDP Ratio Paper Austerity Founded On Was Wrong

[The Dude]

[eynon81]

(raises hand) well I mean I came around to being "meh" about the short term debt in large part because of stuff you and Kane posted...this didn't do it for me, it happened a while back.

[dontworrybehappy]

Even if the study is very flawed, which I certainly have little doubt about, I still maintain that a high debt-GDP rate is not healthy for any country. We know liberals will do ANYTHING to justify gov't spending, even to say it doesn't hurt anything, but that's nonsense.

I think this link explains very nicely why debt-to-GDP ratio, while not a tells-all ends-all means to tell a countries economic health, is DEFINITELY something that must be considered when analyzing a countries ability to grow and prosper.

http://bonds.about.com/od/Issues-in-the ... -Ratio.htm

Under Obama, the US ratio surpassed 100% in 2012 and is expected to be 105% in 2013.

[phosphide]

So, just making sure. Assuming you fix the formula, doesn't it still show that GDP growth was highest at less than 30% debt?

[The Dude]

[The Dude]

[lnrw]

So let me see if I have this right, the idea is that one should increase debt now to make it easier to get out of debt later.

I can understand the concept of fake debt, but why is it fake? If the government owes money to a citizen's fund, then how does it not owe the money?

This sounds much more like a license to increase debt eternally with no design on ever rectifying debt. Just keep passing it forward and don't ever deal with it. Which is what's happening at this time.

[Pebble]

[lnrw]

The 'not really' excuse carries less weight every time you put it on the scale. We keep hearing 'not really' from data sources and economic incantations that look and sound more cheerful when spoken by wall street and various economists, but don't see much on main street that says it's true or that the more cheerful pundits wish to convey as 'my truth is the truth' the data says so. 'Not really' is more of an academic observation than what is actually taking place. 'Not really' is theoretically possible, but not probable.

People don't have any more folding money, more and more are actually unemployed than the 'data' says. With more and more Americans on food stamps, and few boots on the ground indicators that things are different from what can be seen and held, I don't buy it.

Point to a new chart indicating new data all you care to. It means little when you have a longer line at the soup kitchen every time you look.

also you say 'not really', then point out exactly what can go wrong and what has gone wrong. so how is that an indication of 'not really'?

It's what happened and what will continue to happen. the data says so. When greed can be realised, it will be realised when all they have to do is vote, decide or declare. Then later we can say the data pointed us that way.

I do agree that fixing the roof while the sun shines is prudent. But the roof is pretty near gone and we're trying to hold up the walls now. Of course it is wise to save for a rainy day, but now we're calling rainy days sunshine.

[Indy]

The idea is that--correct me if I'm wrong, Dude--you don't worry about debt now until the economy gets moving which--ta-da!--starts to erase the debt because of increased tax revenue. And then you can start tackling the debt because it won't sandbag the economy.

Once again, we see that the austerity pimps have egg all over their face yet they STILL, still cling to ideas that have been soundly debunked. I just don't understand that.

Example: Paul Ryan.