Thursday, August 26, 2010

The Rational Taxpayer v. Dimwitted Puppets of Tyranny

Treasury debt is minuscule to the mountain made on Wall Street and the City.

Like an apple tree among the trees of the woods,
So is my beloved among the sons.

Song of Solomon

* * * * *

The voice of irrationality says our nation has a problem with its "massive" fiscal deficit, as though all debt were created equal and ever blind to risk and reward...




The voice of reason, on the other hand, argues a far more massive mountain of debt whose risk was mispriced and whose reward was transient — created in the private sector and now requiring explicit support from institutions of government — is the debt needing profound reduction, not the safest debt of all. This might seem counter-intuitive, but if you want more for your tax dollar while lowering taxes on your earnings, it is that unproductive mountain of mispriced private sector debt needing immediate restructuring, not the U.S. Treasury.

—Tom Chechatka

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