4 ms·

An out-and-out default is extremely unlikely, but a massive devaluation in the US dollar would be just about the perfect treatment for America's economic woes.

• ck2 15y ago
  So selling twice the number of $1 widgets at 50 cents fixes something? Or just makes us tread water faster? How exactly do we compete against nearly free labor in manufacturing from China and Vietnam and such? (answer: we cannot and should not try - we should tax imports and make selling to ourselves cheaper with domestic products vs imports - people will buy from overseas when their widgets are 50 cents and ours are $1 but not if there's is 90 cents and ours is still just $1)
• kevin_morrill 15y ago
  I agree this is the likely outcoming, but couldn't disagree more about it being the "perfect treatment". What you had with the housing boom was effectively devaluation in a limited sector (along with oil). Inflation causes massive capital misallocations and screwed up pricing signals. Think about how many people who were working in construction and real estate needlessly that could have been working on things people truly need/want. Eventually all those lost man years of effort add up to lost lives in the aggregate.