On Fri, 10 Mar 2006 20:02:15 -0700, TDKozan wrote:

F. George McDuffee wrote:
. . .

Consider what happens when the holders of our public and private
debt realize they are about to be stiffed big time, e.g. the port
management fiasco. Anything that is of value and portable will
be purchased with the trillions of dollars we have so blithely
exported. Operationally this is hyper-inflation where the supply
of goods and services evaporates while the "money supply" grows
geometrically. Actually when you define money as a "medium of
exchange and a measure/store of value" its gone too.

It is at this point Harry Homeowner will discover who was
actually supplying the money for his home equity loan, and who
now owns the house....

All together now "Don't cry for me Argentina" ....
(See how the international banks behaved there when the ship hit
the sand a few years back."

Unka George




So Harry Homeowner goes ahead and pays off his $200K mortgage with two
days worth of take-home pay in devalued dollars. Inflation has no end
of problems attending it but to someone with a fixed-rate mortgage and
any sort of income, it's a godsend.

Real incomes for working people have fallen a lot. Think your job will
outlast a major, major depression while you pay off those deficits?
Or that the neocons can honor those "full faith & credit" (YOUR work
& assets) promises even if they wanted to?

For that matter, the same thing
applies to national debit in spades.

You seem to forget that there will be panic buying when the
first of the pack decide to get rid of those value-losing dollars
before it's too late.
But there's little to buy ....

BTW, Home forclosures are at a rate 3 to 4 times
now compared to what they were *during* the first Bush
"recession".
HTH
--
Cliff