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Note that TBP had a similar debt in 2005: James Altucher: “The Underlevered American Household”
While yesterday's US stock market close was poor, Asia and Europe didn't follow today as debt in Greece, Spain, Portugal, etc... rallied, their CDS narrowed and stocks bounced. The Greek finance minister said January tax revenues came in above expectations and that spending was below target for the month and said "that means the deficit reduction for January is well within what we have promised." The euro is rising in turn. Also helping is the story that Trichet is headed to the European Union leaders summit a day early in order to address Greece's problems even as the Greek finance...
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September 18th, 2009 at 8:23 am
Very well composed for a crack addict. His rationale would be more credible if he was wearing one of Matthew Lesko’s jackets. The best line…”think about it like an economist would.” Yup, that’s been working out fine.
September 18th, 2009 at 8:50 am
Moron.
September 18th, 2009 at 9:09 am
Because debt is money, and our economy is starved for money, Mr. Fisher is correct that the economy needs more debt. However, there is a substantial difference between federal debt and all other debt.
The federal government never has difficulty servicing debt of any amount. Even during times of massive deficits, no federal check ever bounced. All other debt, public and private, is limited by the supply of collateral and by income. These limits leave debtors vulnerable to bankruptcy.
For that reason, federal debt should not be viewed the same as other debt. In the past 50 years, every recession has been preceded by reductions in debt growth, and all have been cured by increases in debt growth. Further, every depression in U.S. history has been preceded by federal surpluses. (See: http://rodgermmitchell.wordpress.com/2009/09/07/introduction/)
Rodger Malcolm Mitchell
September 18th, 2009 at 9:18 am
Fees baby, Kenny got a big yacht. Tool. Rich successful tool.
September 18th, 2009 at 9:19 am
@RodgerMitchell
WRT federal checks bouncing, just because it’s never happened, it doesn’t mean that it never will. When most 6 year olds fall on the playground, they don’t break their hip; now try that when you are in your 80’s. America is drowning under a mountain of debt, private AND public. Ken Fisher is advocating that subsequent generations pay the interest for this gigantic party tab. That is a pyramid scheme of the largest order. It is also immoral.
September 18th, 2009 at 10:03 am
@RodgerMitchell
Yes, but then we’ll have to come up with new and creative ways to disguise the real inflation numbers.
September 18th, 2009 at 12:27 pm
@Cursive. No Federal default. They would crash equities, corporates, munis and anything else first. Increased US savings will result in decreased debt levels and the eventual crash of equities will usher peep into buying Treasuries for the rest of their lives.
What was so curious about the dog last night, Watson? The dog did NOT bark in the night, Holmes.
Exhibit A: Japan – JGB yields did NOT blow out. Elementary, my dear Watson.
September 18th, 2009 at 1:19 pm
“That is a pyramid scheme of the largest order. It is also immoral.”
Amen. Fisher is just another in the herd of greedy, selfish, immoral hucksters, trying to rationalize this immorality with shuck and jive to lure in the doubtful. Haven’t we had enough of that already? And is it any wonder that we are now hearing from his like as the market reaches these levels and they are once again emboldened.
Good job Bernanke et al. This is what you have wrought. May history judge you harshly.
September 18th, 2009 at 5:22 pm
[...] Ken Fisher on how we need MORE debt. Frankly, I think the guys in the white coats need to come and get this guy. What’s up today? [...]
September 19th, 2009 at 9:48 pm
I’m no economist, but I think I see the flaw in Fischer’s argument. Our federal debt has NOT been used to acquire assets to increase ROI as would be the case in a prudently run business; it has been used on Ponzi-inspired entitlements for the middle class. Also, I will conceed that our military response to 9/11 could have been more intelligently managed so as to conserve resources….but I won’t go all the way with BR and agree that 9/11 should have been used as a catalyst for social reform.
September 21st, 2009 at 6:13 am
[...] solitary contrarian voice, Ken Fisher’s, still says the US is ‘under indebted’ [...]
September 23rd, 2009 at 9:25 am
Why all the Fisher haters? He’s a brilliant guy. Always love to hear his viewpoint, because you know you will hear from a guy who has tried to look at the world from another angle. This is no different.
If I remember right, in Fisher’s book, the balance sheet doesn’t include TANGIBLE assets of the government or financial sector, which no one calculates. If you included them it would likely lower the ROA number, but not sure how much. Of course, the increase in assets would also improve the balance sheet picture of debt too…
You should read Richard Koo’s interview in Welling if you want to hear someone arguing how we need more debt… Good interview. Not sure how much I agree, but it was a good interview…