More Deficits, More Debt

December 19, 2011 – In the first two months of the current fiscal
year that began on October 1st, the US national debt has grown $320
billion. That is $21 billion more than the same 2-month period last
year, which illustrates that the growth of the national debt continues
to accelerate. The reason of course is the federal government’s huge
operating deficit, which is not getting any smaller. This point is
illustrated in the following chart.

Hyperinflation is always the outcome of unchecked government
spending. The spending leads to ever greater deficits, which requires
the government to borrow ever greater amounts of money. Eventually a
point is reached when the government needs to borrow more money than
lenders have the capacity – or willingness – to lend. Thereafter the
government can take either of two alternative paths.

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via More Deficits, More Debt.

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