Wednesday, November 28, 2012

Trends in Interest Rates on National Debt Suggest Currency Crisis is Coming

It is amazing to think about the daunting chart below.  As debt levels have shot towards the moon, interest rates have moved in just the opposite direction which fundamentally does not make since.  As debt levels increase so would your assumed risk.  As your assumed level of risk increases so should your interest rate.  At least this is how it is supposed to work.

As Mish Shedlick argues in this post, a looming currency crisis could be in the works.

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