3/31/10

This is the problem with large deficits

News. March 31 (Bloomberg) -- Greece may pay about 13 billion euros ($17.5 billion) more in interest on the debt it sells this year than it would have if yields had stayed at their pre-crisis levels relative to Germany’s, according to data compiled by Bloomberg and Credit Agricole Corporate and Investment Bank.

My view. This is the problem with large deficits. Not inflation, as I wrote several times in the past. The interest to the bond holders has to be paid. Who is going to pay it? The populace, of course. How? From the their own pockets.

The outcome is even lower standard of living and depressed purchasing power.

George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
Ranked Top Market Timer in 2009 and 2010 by Timer Digest

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