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#41
10-10-2007, 05:07 PM
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Re: A Question about Ron Paul\'s Economics
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Please explain how earning a return lower than the borrowing rate makes makes our economy strong. [/ QUOTE ] First of all, ALL ECONOMIC ACTIVITY IN THE ENTIRE COUNTRY is not financed by the government deficit. Second, you compared a nominal rate (Treasury interest) with a real rate (GDP growth). 
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#42
10-10-2007, 05:12 PM
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Re: A Question about Ron Paul\'s Economics
[ QUOTE ]
[ QUOTE ] Please explain how earning a return lower than the borrowing rate makes makes our economy strong. [/ QUOTE ] First of all, ALL ECONOMIC ACTIVITY IN THE ENTIRE COUNTRY is not financed by the government deficit. Second, you compared a nominal rate (Treasury interest) with a real rate (GDP growth). [/ QUOTE ] You're partially right. Nominal GDP and Treasury rates are the only comparables IF you assume that T rate reflects US inflation and the US time value of money. I don't agree since most of the people that own our debt are not included in our GDP. However, you're overlooking the GEM multiplier. Edited to say please don't lock just cause a debat is going on.
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