Alan Greenspan is perched on the edge of his keyboard advising that budget deficits are bad but budget surpluses are worse because they render the Fed impotent.
The Chairman fears a run on US Government Bonds when the medicare bill comes due on a low tax base. Raising taxes, repealing old accommodations, in a recession seems questionable.
But these taxes would be borne by those who can afford them: the taxpayers who own $3 trillion worth of US real estate without a mortgage.
The Chairman may have struck an efficient solution to funding future deficits without having to declare the Yuan a reserve currency
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