I asked:
>can't assets be used as collateral, so that the debt/asset ratio is
>relevant?
Alex writes:
>The point is that the debt/asset ratio ( 'assets as collateral') is a
>misleading indicator of the capacity to borrow *of the private sector as a
>whole*. From other micro-perspectives ( whatever the unit of analysis: a
>household alone, a firm, even a subindustry) the debt / asset ratio may be
>valid (to an extent)^(footnote):
I was thinking only of the consumer/household subsector of the private
sector, rather than the private sector as a whole. Thus, a (somewhat) micro
perspective makes sense.
Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
