Bill Lear wrote: > My brother has advanced the novel idea that borrowing at negative real > interest rates is what brought on the inflation of the 1970s.
Negative expected real interest rates encouraged high demand during the 1970s (with rising fixed investment relative to the 1960s) which happened despite the stagflation of that period but that says nothing about the supply-side reasons for the inflation (oil shocks, low profit rates, etc.) > Also, how is a sovereign borrowing money different than it printing > money? it's almost the same if the sovereign's currency is used as the world currency (as with the US$) but they're very different for other cases, especially that of countries with non-convertible currencies. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
