Life, Debt and GDP
I am reading an interesting piece on the relationship between Debt and GDP, this continued from my reading last week on Debt and the Exchange Rate… I am trying to figure out at what point I should start to feel good about increasing GDP and lowering exchange rate. Since increase borrowing can increase GDP but only marginally so that the trade off is not worth the borrowed money and increase borrowing can lower our exchange rate since we artificially flood the market with currency we did not earn. Our Governments have trained us to react to certain stimuli without giving us the real story behind those stimuli. Marginally increasing GDP and lowering exchange rate through excessive borrowing, doubling our debt is nothing but window dressing, eye candy and false positives as it is not sustainable or real, unless we earn way more than we borrow and debt repayment is a low percentage of every dollar earned, currently our debt is over 140% of GDP and 80 cents out of every dollar goe...