debt payment

[NightBiker07]

deb\Here is an interesting lesson on Stimulus Analogy economics.
> >>>
> >>> It is the month of August, on the shores of the Black Sea . It is
> >>> raining, and the little town looks totally deserted. It is tough
> >>> times, everybody is in debt, and everybody lives on credit.
> >>>
> >>> Suddenly, a rich tourist comes to town. He enters the only hotel,
> >>> lays a 100 Euro note on the reception counter, and goes to inspect
> >>> the rooms upstairs in order to pick one.
> >>>
> >>> The hotel proprietor takes the 100 Euro note and runs to pay his debt
> >>> to the butcher.
> >>>
> >>> The butcher takes the 100 Euro note, and runs to pay his debt to the
> >>> pig grower.
> >>>
> >>> The pig grower takes the 100 Euro note, and runs to pay his debt to
> >>> the supplier of his feed and fuel.
> >>>
> >>> The supplier of feed and fuel takes the 100 Euro note and runs to pay
> >>> his debt to the town's prostitute that in these hard times, gave her
> >>> services on credit.
> >>>
> >>> The hooker runs to the hotel, and pays off her debt with the 100 Euro
> >>> note to the hotel proprietor to pay for the rooms that she rented
> >>> when she brought her clients there.
> >>>
> >>> The hotel proprietor then lays the 100 Euro note back on the counter
> >>> so that the rich tourist will not suspect anything.
> >>>
> >>> At that moment, the rich tourist comes down after inspecting the
> >>> rooms, and takes his 100 Euro note, after saying that he did not like
> >>> any of the rooms, and leaves town.
> >>>
> >>> No one earned anything. However, the whole town is now without debt,
> >>> and looks to the future with a lot of optimism.
> >>>
> >>> And that, ladies and gentlemen, is how the United States Government
> >>> is doing business today.

[hoofarted]

...true

[redrocket190]

Not a good analogy because they could all have settled their debts with an IOU or another form of currency - including barter - without the need for the 100 euros i.e. there was no increase in the "money supply". What's really going is the Government is printing or borrowing money and giving it to the hotelier, hooker, butcher - whomever - and having paid of their debts they all supposedly start to buy things again. Whoops without an increase in available goods and services to keep prices under control, the extra money drives up prices through competition and inflation occurs. In response the government does nothing and steals from everyone's savings indirectly, or raises taxes and interest rates and everyone gets fucked - not just the hooker. Short-term solutions whether in Corporations of Governments that distort markets always end up bad in the long run.

[ISBB]

but how do we know that IOU wouldnt turn into sub prime loan of some form.. best pay w/ da cash

[iggys-amsoil]

Cash-to-become-extinct within a decade