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> Oil shocks, interest rates at 15%. History rhymes. Except the G-20 average public debt in the 70s was like 30% of the GDP. We cannot go to interest rates at
by TacticalCoder 4y ago
> Oil shocks, interest rates at 15%. History rhymes.
Except the G-20 average public debt in the 70s was like 30% of the GDP.
We cannot go to interest rates at 15% with countries having 100%+ public debt (as is the case nearly everywhere in Europe for example).
- 31835843 4y agoGood point. While the interest rates are “high” now (prime rate is 4.75?) that is actually a regression towards the mean, and definitely not 1970s hyperinflation territory. I wonder though — given that we can’t go to that 15% rate (because then servicing public debt would be too expensive), what other tools do we have left to tame inflation?
- wombatpm 4y agoWe’ll they can, but the trick is to not add new debt and pay the old debt with inflated dollars. Welcome to austerity 2.0