tag:blogger.com,1999:blog-2850462849314268040.post1841571772257812691..comments2024-03-10T00:26:57.262-08:00Comments on The Dance of the Hippo: I'll bet you Debt to Donuts ...Karlhttp://www.blogger.com/profile/11654006671545294361noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-2850462849314268040.post-39392168392621396642013-04-24T19:39:33.359-07:002013-04-24T19:39:33.359-07:00Yeah, out past 150% you're looking at growth o...Yeah, out past 150% you're looking at growth of about 1% per year. But you can go well past 100% and still have growth of about 1.5% per year. The point is not to prove that debt doesn't matter, but that the Reinhardt-Rogoff conclusion of DOOM out past 90% is sheer nonsense.<br /><br />And from an ecological perspective, this whole conversation is full of cognitive dissonance anyway, since our real concern right now shouldn't be to grow as fast as possible, but to have an economy that meets human needs with minimal growth, or even degrowth. So we shouldn't be worried about debt.<br /><br />Except that, or course, we came out of World War II with a debt north of 100% of GDP, and the reason we were able to shrink that relatively painlessly was precisely because of debt, so if we think we need to be building an economy that functions well without GDP growth, then maybe we DO need to worry about debt ...Karlhttps://www.blogger.com/profile/11654006671545294361noreply@blogger.comtag:blogger.com,1999:blog-2850462849314268040.post-36681473611283708612013-04-24T19:28:28.460-07:002013-04-24T19:28:28.460-07:00My "contrived" flag is fluttering at ful...My "contrived" flag is fluttering at full mast! What intrigues me about these graphs is not the best fit lines, but the range of variation. Clearly, as the debt ratio goes up, the range of variation in growth undergoes considerable constriction. In other words, at low debt ratios, growth ranges excitingly from dismally low to dizzyingly high, but as the debt ratio increases it pinches painfully to a level that can only be called mediocre. Stanhttps://www.blogger.com/profile/12938840059106099935noreply@blogger.com