We’re past the point of no return on the U.S. government’s deficit. That doesn’t bode well for those of us who live under U.S. government subjugation. From el gato malo at boriquagato.substack.com:
this is not a can we’re kicking down the road, it’s a snowball
the last several years have seen a level of federal spending unparalleled in american history.
leaving aside that this was obviously a needless own goal of panicking into
shutting down the world to no good end and all bad outcome, the sheer
magnitude of it beggars belief and has made the US economic charts all
but unreadable by distorting their scales so severely. everything else
looks like a flatline.
truly problematic and this issue is being compounded by the historic
spike in rates from the artificially suppressed near zero values of
recent decades to levels more in keeping with historical norms and make
no mistake, these are norms. it was ZIRP that was the aberration and
it’s not coming back. rates that low could only persist without setting
off massive inflation because of the outlandish overcapacity of china
suppressing world prices for consumer and durable goods. so long as
they were willing to sell below cost, there was basically no monetary
policy rash enough to cause the price of a set of lawn furniture to
rise. it kept dropping relentlessly as deflation reigned. it was
astonishingly clear in the data as was the divergence from services
(which were not affected by this trend).
