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I still think we will muddle through it. Things that aren't sustainable don't continue. People will start charging more to lend to the US. Systems will feel
by mathattack 13y ago
I still think we will muddle through it. Things that aren't sustainable don't continue. People will start charging more to lend to the US. Systems will feel stress. Health care will be rationed because there is no other way. Everyone will work longer because there is no other option. We may need to inflate some if our wealth away to lighten the debt load.
The wake up will be someone else's system collapsing first (Japan? France?) which will cause global economic stress. After the flight to US dollars, our borrowers will force us to get our act in gear.
- jstalin 13y agoMy bet's on Japan.
- mathattack 13y agoI love Japan as a country so I hope you are wrong. The demographics suggest you are right. The powerful interest groups that Friedman mentioned also exist there too. Two differences with Japan: First, their debt is domestically held so they can avoid bond vigilantes. Second, as a country and culture they have been able to come together and solve great problems when they get consensus. (They just haven't had that consensus in decades)
- exit 13y agohow could they possibly work more?
- mathattack 13y agoBy longer I mean having a later retirement age.