--->A high interest rate doesn't necessarily mean a currency is sound, fundamentally. In this instance, it'd be like a metal roof on a thatched hut. It keeps the money in, for sure, but it goes to debt service.
Were those answers really worth writing? 1. When everyone is on your side of the trade... you are wrong. 2. having traded for a living I am always leery of the obvious result. 3. I had no desire to turn this into a Fed bashing debate.... but... I refer you to Greenspans record of controlling a bubble by lowering rates and allowing liar loans. i thought central banks were supposed modulate cycles not exacerbate them. I will defer to guys like Thomas Jefferson? Thomas Jefferson wrote: "The [privately-owned] Central Bank is an institution of the most deadly hostility existing against the principles and form of our Constitution...if the American people allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporationsthat will grow up around them will deprive the people of all their property until their children will wake up homeless on the continent their fathers conquered." 4. If Volker was involved with a new Greek Central Bank would you really still make an bet on inflation.... I brought him up as an example of how perhaps a central bank should be run. Now do you see the connection . 5. In the world of Sovereigns we have Bono getting debt forgiven a loans from the IMF. Debt forgiveness is a lot like bankruptcy --- don't you think? 6. Its odd you say that because the moral of Volkers story is that a little short term pain while he crushed inflation expectations... set the U.S. up for a 15 year expansion. Bernanke just spent how many trillion to avoid pain. He changed agency debt in to treasury. he spent how many trillions on bad assets. The story about Soros has turned into marketing cliche my 10 year son knows it. Why don't you tell us who was the money behind Soros. That would be a useful reply.
How can everyone be in debt. A lot of this is they are all holding each others debt. What is left is owned by China, Taiwan and Japan and the likes.
These numbers cannot be correct as both Japan and China have national debts. The Japanese have one of the highest debt to gdp ratios that I know of, excluding these numbers. Not sure where you got them. Link? **edit** This is external debt to GDP. Japan has a very high savings rate. Still I would appreciate a link.
I agree China and Japan should be on the Debt list. Here is the link-: http://www.cnbc.com/id/30308959/The_World_s_Biggest_Debtor_Nations http://www.picassodreams.com/picass...p-to-external-debt-default-is-inevitable.html
all perception is reality, if they think the swiss CAN pay them back, they will continue to loan money to the chinese,japanese,swiss regardless of a meaningless statistic