Oh yeah?
None of that is stopping congress from running up a national debt into trillions of dollars which can NEVER be repaid.
Right, same rule applies to the Federal govt. If they grow debt beyond a sustainable level (ours is not the worst in the developed world quite yet), then it won’t be payable by future taxpayers without completely killing economy and will have to be defaulted upon or inflated away. We knew when the crisis got going last year and last summer that the Fed chose the inflation route. The trouble is the market got ahead of the Fed (deflation) and pointed the way to default. So the Fed will need to inflate that much more.
Congress is trying to save their behinds.
Look.
This is the situation.
If the banks decided that they weren’t making enough to hand out their billions of dollars in bonuses, all they would have to do is close the doors.
Then there would be blood in the streets, including some, if not most, Congressmen.
So the banks have the POWER to TELL WASHINGTON WHAT TO DO.
And they did. It will never be repayed and the dollar is headed towards toilet paper status.
The banks and money market funds and schwabbs of the world don’t care, as long as the cush continues.