US bonds sale faces market resistance

[celticlord]

US bonds sale faces market resistance - Telegraph

The US is not alone in facing a deficit crisis. Governments worldwide have to raise some $6 trillion in debt this year, with huge demands in Japan and Europe. Kyle Bass from the US fund Hayman Advisors said the markets were choking on debt.

"There isn't enough capital in the world to buy the new sovereign issuance required to finance the giant fiscal deficits that countries are so intent on running. There is simply not enough money out there," he said. "If the US loses control of long rates, they will not be able to arrest asset price declines. If they print too much money, they will debase the dollar and cause stagflation.

Deficits last only as long as someone is prepared to cover the check. Governments around the world are writing checks that nobody can cash.

Damn Keynes and his glorifications of deficits, and damn any politician who thinks that spending money that doesn't exist is ever a good idea. Perhaps some debt and occasional deficits are acceptable, but the level to which government has become addicted to debt is wholly unacceptable.

We are better off recalling the words of Alexander Hamilton: "A national debt, if it is not excessive, will be to us a national blessing."

When there is no longer enough capital in the world to satisfy government hunger for debt, it is long past time to seriously starve the government beast.