Comments on: Sovereign debt maths show risk of vicious circle http://blogs.reuters.com/breakingviews/2010/04/09/sovereign-debt-maths-show-risk-of-vicious-circle/ Mon, 26 Sep 2016 03:26:00 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Ghandiolfini http://blogs.reuters.com/breakingviews/2010/04/09/sovereign-debt-maths-show-risk-of-vicious-circle/comment-page-1/#comment-2166 Mon, 12 Apr 2010 20:41:17 +0000 http://blogs.reuters.com/columns/?p=2823#comment-2166 Economic Recovery

It is a slow day in the small Texas town of Paris, and streets are deserted. Times are tough, everybody is in debt, and everybody is living on credit.

A rich tourist visiting the area drives through town, stops at the hotel, and lays a $200note on the desk saying he wants to inspect the rooms upstairs to pick one for the night.

As soon as he walks upstairs, the hotel owner grabs the note and runs next door to pay his debt to the butcher.

The butcher takes the $200 and runs down the street to retire his debt to the pig farmer.

The pig farmer takes the $200 and heads off to pay his bill to his supplier, the Farmer’s Co-op.

The guy at the Farmer’s Co-op takes the $200 and runs to pay his debt to the local prostitute, who has also been facing hard times and has had to offer her “services” on credit.

The hooker rushes to the hotel and pays off her room bill with the hotel owner.

The hotel proprietor then places the $200 back on the counter so the rich traveler will not suspect anything.

At that moment the traveler comes down the stairs, states that the rooms are not satisfactory, picks up the $200 note and leaves town.

No one produced anything. No one earned anything… However, the whole town is now out of debt and now looks to the future with a lot more optimism.

And that, ladies and gentlemen, is how the Western governments is conducting business today.

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By: Pete_Murphy http://blogs.reuters.com/breakingviews/2010/04/09/sovereign-debt-maths-show-risk-of-vicious-circle/comment-page-1/#comment-2163 Sun, 11 Apr 2010 11:04:41 +0000 http://blogs.reuters.com/columns/?p=2823#comment-2163 You left out one big factor – the balance of trade. Running a large trade deficit robs the economy of jobs and forces the government to rely more heavily on deficit spending to prop up social safety net programs.

Greece has the highest per capita trade deficit of any developed nation, more than double that of the U.S.

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By: Story_Burn http://blogs.reuters.com/breakingviews/2010/04/09/sovereign-debt-maths-show-risk-of-vicious-circle/comment-page-1/#comment-2162 Sat, 10 Apr 2010 15:15:56 +0000 http://blogs.reuters.com/columns/?p=2823#comment-2162 Cost cutting and austerity measures are no fun. Greece is going to me miserable the next few years

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By: Ghandiolfini http://blogs.reuters.com/breakingviews/2010/04/09/sovereign-debt-maths-show-risk-of-vicious-circle/comment-page-1/#comment-2158 Fri, 09 Apr 2010 20:33:56 +0000 http://blogs.reuters.com/columns/?p=2823#comment-2158 Now there is a hairdo.

A debt trap is a debt trap, no matter how you try to dice and slice it or colour it or spruce it up.

Let’s face it, mostly China is solvent, for the rest of us, we are bankrupt.

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