I'd go further and consider the net interest paid to GDP ratio, if we're in this context.
Then there is the uber-Keynes view, to which I've become increasingly sympathetic, that these ratios don't matter at all. (Note Japan's debt/GDP ratio is 2.3 (230%) and while they have not been the greatest economy they are not blowing up.) On Sat, Mar 23, 2013 at 11:11 AM, Tom Walker <[email protected]> wrote: > Thanks Julio, it's good to know somebody actually reads these ravings. As > everyone with an ounce of understanding of economics knows, it's not the > nominal amount of debt that matters, it's the debt to GDP ratio. More GDP > means more revenue to service debt. > > But what if the Pope and the Cardinals don't believe in God? Could they > admit it and still retain their hold over their flock (and the assets of > the Vatican)? I mean what if the ruling class doesn't believe in the GDP > and knows damn well that to admit the Emperor has no clothes would be to > forfeit their hegemony and very possibly their necks. > > It seems to me that if our almighty and merciful rulers lost faith in GDP, > they would go on a binge of asinine "austerity" and deflationary "debt > reduction" all the while hypocritically insisting on the sanctity of GDP > and holy growth. This would enable them to rake in as many chips as they > can before the deluge. > > Suddenly, if you look differently at the GDP end of the debt to GDP ratio > and don't assume liars believe their own lies, the austerity swindle makes > a lot more sense. > > On Sat, Mar 23, 2013 at 3:22 AM, Julio Huato <[email protected]> wrote: > > >> For more immediate purposes, there's still the question of whether to >> use these measures or not. I think it depends. I admit that, in >> principle, there may be cases in which GDP measures are not only >> potentially misleading, but that it may in fact be impossible to >> determine a proper way to correct for the bias. Let alone the size, >> the algebraic sign of the bias may flip, so that using GDP measures or >> using "random" numbers may yield the same results. That said, I doubt >> it seriously that this is the case in general. >> >> > -- > Cheers, > > Tom Walker (Sandwichman) > > _______________________________________________ > pen-l mailing list > [email protected] > https://lists.csuchico.edu/mailman/listinfo/pen-l > >
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