Sunday, March 04, 2007

60 minutes on US Financial Troubles

Link The story provides some food for thought. I've heard there are economists who say trade deficit isn't a problem. It just means were trading dollars for goods that we want. But this piece seems to take a different tack. It seems to say that we won't be able to afford social security and Medicare for the boomers because we will need to pay interest on all our debts. I guess that means interest on the treasury bills? I'm a little confused, but the other way is to devalue the dollar, meaning we could just print more money. But if we have runaway inflation we'll be in trouble, right? It could lead to stagflation or recession. I wonder if I should be buying Euros or something.

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