That the developed world’s governments are accumulating outsized debt shouldn’t be news to anyone. Unless there are some tricks up the government’s sleeves — and they are tricksters — there will be defaults. And here is the trick: force regulated financial institutions to buy and hold zero-rate perpetuity government bonds that pay neither interest nor principal. It’s the equivalent of repudiation without default at the expense of private wealth. We are well on the way to that. Continue reading
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