Just think about this raghu: deficit is a flow, debt is a stock. If the cash outflow is more than the cash inflow, then there is deficit and the debt stock increases. QE2 is partly about increasing the government spending on things that are not rent payments without increasing the debt stock. If I buy the apartment you rent and give you the right to live in it without collecting any rent, can't you spend more of your salary on consumption of other things? Furthermore, your landlord now has the cash and needs to do something with it! This is where the capital controls come into play, in my opinion.
Best, Sabri _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
