Thursday, February 08, 2018

The federal debt may not be that much of a problem

Looks like Congress may finally be able to pass a budget deal that lasts more than a few minutes (I mean weeks). This time, pushing the snooze button on "debt ceiling alarm clock" might have more sticking power. That alarm was a bit annoying and actually made things worse; like tossing sand in the gears. This deal might give everyone some candy at least. Tax cuts, more spending for the military, Medicare and so forth. It's easier to get agreement when one can provide, rather than take stuff away from people; especially when many of the needs are real. We can just add to the long term deficit which, so far, seems to only cause minor consequences. I guess Federal Reserve can print money to cover, if need be. Inflation is a consequence, but overall inflation has been low for a long time. In certain metro areas, housing inflation has been strong and that can spread to other parts of economy as wages go up, though.

People worry about future generations being buried in debt, but future generations will do just fine. If inflation is a problem, they can just move the decimal point over in their money. The dime can become the new penny. Maybe even the dollar will become the new penny. Future generations can start from there and will not likely know the difference.

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