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View Diary: NYT: It's Krugman Vs. Reinhart & Rogoff, Who Trivialize Their Incompetence And Attack “Left” (246 comments)

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  •  For different reasons... (1+ / 0-)
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    Words In Action

    You issue debt if there is a public policy purpose for the private sector to hold debt instead of currency.

    Notice in that sentence that there is nothing about issuing debt in order to deficit spend.  It is about whether there is a public purpose to an extremely safe interest bearing financial instrument issued by the currency issuing government.  Under that policy it is possible to make an argument that there are situation where the government should issue debt instruments even in the event of a surplus.

    A couple possible ideas (might not be good ones):
    1) Maybe we want retirees to have a safe investment and that is a good way to do it.
    2) A method for control of long term interest rates.

    •  Currency is debt. Every dollar is a (0+ / 0-)

      certified IOU. Certified because socially recognized. For comparison think of marriage certificates.

      We organize governments to deliver services and prevent abuse.

      by hannah on Sat Apr 27, 2013 at 02:29:38 AM PDT

      [ Parent ]

      •  Context please... (0+ / 0-)

        In particular context, I am using debt interchangeably with bonds.  Perhaps imprecise, but the point is that bonds have a role in public policy that has nothing to do with financing the federal government.

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