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Krugman Trolls Deficit Hawks With One Amazing Chart
The Huffington Post | By Mark Gongloff
Posted: 10/29/2013 11:35 am EDT | Updated: 10/29/2013 3:14 pm EDT
Debt scolds like Harvard economists Kenneth Rogoff and Carmen Reinhart constantly warn us that too much government debt causes terrible things like soaring interest rates and wrecked economies. History often disagrees.
Paul Krugman teased Rogoff and Reinhart about this on Tuesday with a chart he found on the Bank of England's website. It's a chart that shows 300 years of British debt and interest rates, which is just awesome in its own right, if you are the kind of geek that gets into that sort of thing. Adding to the risk of nerdgasm, the chart highlights England's "major war periods."
The chart also directly contradicts the debt scolds. It shows many long stretches in which England carried a massive debt burden, particularly after its extended war orgy around the turn of the 19th century, which included the American Revolution and the War of 1812.
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http://www.huffingtonpost.com/2013/10/29/krugman-reinhart-rogoff_n_4173654.html
indepat
(20,899 posts)colonialist in the New World.
starroute
(12,977 posts)Those continued on and off for about 20 years, with just one brief armistice.
The American Revolution is the not quite so far bar before that.
Spitfire of ATJ
(32,723 posts)Stock prices are set by supply and demand and fluctuate wildly. The players are risk takers but willing to cash out at the slightest HINT of insolvency in a company. Bond holders tend to think long term and don't buy the crap from hair on fire Conservatives shilling for Wall Street and claiming that bonds are "nothing but IOUs".