Thursday, April 23, 2009

The government should join GASG

Voltron says: The government's plan to convert the Treasury's holdings of
bank preferred stock to common stock follows a now familiar pattern. It's a
gamble. By swapping senior debt for the lowest rung equity shares, the
government is increasing it's risk instead of just spending a known amount
of money. Why is the government gambling with our money? There is not
political will to say, "hey it's going to take XYZ amount of money/work to
get out from under this" Instead, it's a series of increasingly desperate
gambles. Right now, the debt is a manageable percent of GDP (40% + 45% for
Social Security and Medicare). If we keep going down this path, pretty soon
it won't be. Again, I don't mean to get on a soapbox. I'm just pointing
out that we are going to be forced to inflate away this debt, because no one
is willing to work it off.

P.S.: GASG stands for "Gambling Addiction Support Group" which was the name
of the email list that was the predecessor to this blog.

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