Pepper sprayed for public safety.

[sebastian_dangerfield]

This is the fundamental disconnect. No one replays the bonds down that road. Instead, the bond shrink relative to a growing economy over the long term as we run balanced or close to balanced budgets when the economy is closer to full employment (Bush administration not withstanding).

This assumes substantial growth. That's the disconnect. The evidence supporting a future of such growth is between non-existent and weak.

The something magical is people (and entities) moving back closer to historical saving rate (i.e., less hoarding of cash) and the economy getting closer to potential.

The only hoarding going on is at the corporate level, and among the wealthy who can afford to save substantial amounts. And the recent historical savings rate of zero to -10% is not a desired end for obvious reasons.

No, it really isn't. These gentlemen to not believe there is anything credible about Austrian business cycle theory, not least because Austrian predictions over the last four years have proved demonstrably wrong (gee, where's that hyper inflation?).

Patience. If you print, it will come. Recall, economic crises like hyperinflation always appear more suddenly than expected, and then accelerate at breathtaking speed.

But a key point is that not all debt is created equal, and we, in the U.S., do not have a public debt problem (nor does Spain, nor did Ireland before it took on a ton of private bank debt).

Yes we do. If the growth needed to shrink the debt relatively over time fails to materialize, we have a disaster on our hands. Again - that's the disconnect. You say we'll get the growth. I don't see it happening (in part because of our public overspending, which has created a situation where we are going to have to substantially raise taxes, rendering us less advantageous for investment).

I explained why Spain had a problem with public debt last week. I'm not going to repeat it. Regarding Ireland, I agree with you. That bank bailout was a crime against the Irish people. The politicians should be hanged for it (and the people slapped collectively across the face, for allowing themselves to be screwed like that). However, Ireland is floating debt once again, and I think the ECB is buying it, so perhaps the Irish politicians have found their brains, and balls, and started blackmailing the central bank into transferring the debt onto its balance sheets, where it belongs.*

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* Where it really belongs is cancelled. The Irish should've stuck their creditors as Iceland did, but that's water under the bridge.