Delinquencies in NYC Were Rising Until Late Last Summer When New NY Law Took Effect; Defaults Return as Moratoriums Wore Off in Massachusetts and California, Same May Happen in New York; NYC Unemployment Rate Rose to 7.4% (In Focus)
Bloomberg, February 02, 2009
Page after page of professional economic journals are filled with mathematical formulas leading the reader from sets of more or less plausible but entirely arbitrary assumptions to precisely stated but irrelevant theoretical conclusions. —Wassily Leontief, Science, Volume 217, 9 July 1982, p. 106.
Poor sovereign government finances are not just the province of Europe. Fitch this morning downgraded the credit rating of Japan to A+, one notch below both S&P and Moody's. Fitch stated the obvious extraordinary amount of debt they have relative to GDP but said "the country's fiscal consolidation plan looks leisurely relative even to other fiscally challenged high income countries." As in some European countries, there will never be enough growth in Japan to sustain their debt so policy makers have only two choices, debt restructuring/writedown or print money and unfortunately printing money will be the politically easier decision. The...
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