The medicine that has helped, and that remains necessary for the time being, is government debt.

Currently, they are wrestling with widening sovereign debt problems and high unemployment.

Debt, however, is a burden imposed by current citizens on future generations.

The European debt crisis, however, remains, and markets do not fully trust the current calm.

In the end, they are different methods of forcing current and future generations to shoulder the burden of accumulated debt.

The most obvious parallel to Europe s current woes is the Latin American debt crisis of the 1980 s.

Fiscal expansion is always risky, as it adds to debt and raises dangers later. But, given where we are, the benefits exceed the costs in countries with sustainable debt.

Given this, we should expect Greek debt yields to rise further, despite the current IMF program.

When the recession is over, the US and virtually every other country will have substantially higher debt to GDP ratios.

The eurozone s problems certainly help the US sell more debt at lower prices for now.

But the current spread between the yield on German sovereign debt and that of the Italian and Spanish governments far exceeds what is required to ensure that investors differentiate appropriately.

Notably, the compact should count commercial as well as financial debts, and government budgets should distinguish between investments that pay and current spending.

But the risk that the world s investors currently are trying to avoid by rushing into US, Japanese, and German sovereign debt is not a fundamental risk.

And the cost of carrying the extra debt incurred is extraordinarily low 12 billion a year of extra taxes would be enough to finance the fiscal stimulus program at current interest rates.

First, the scale of the debt burden built up over close to 20 years of conflict was monumental, amounting to more than 4 billion three to four times the level of indebtedness relative to income of the most severely indebted European countries currently facing difficulties.

To understand Hamilton s achievement and thus to appreciate its significance for our own times we need to understand the scale of the Revolutionary War debt crisis.

Debt

Save current project to a different location

In getting from here to there over the next eight years, a higher debt America would see productivity growth slow by perhaps a third of a percentage point per year.

But, for now, a complete meltdown seems distinctly less likely than gradual stabilization followed by a tepid recovery, with soaring debt levels and lingering high unemployment.

Debt and Delusion

Debt and Democracy

The Debt Delusion

Debt relief

The country simply cannot keep on piling debt upon debt.

The current safety net approach may work in the short term but will ultimately lead to ballooning and unsustainable government debts, particularly in the US and Europe.

Such a debt conversion program would offer five benefits. For starters, unlike the ECB s current quantitative easing, it would involve no debt monetization.

As during the Great Depression and in many debt restructurings, it makes sense in the current contingency to mandate partial debt forgiveness or a debt for equity swap in the financial sector.

Debt Déjà Vu

Europe s Debt Wish

(d) Debt burden

Austerity and Debt Realism

Debt and America s Decline

The Debt Death Trap

The Government Debt Bomb

Haiti External debt

External debt

External debt

Present Position

Current status

Responsibilities included organizing

1994 Judge, Federal Court of Malaysia

The European debt crisis, however, remains, and markets do not fully trust the current calm. The risk premia that financially distressed countries must pay remain high and signal continuing risk.

In 2008, on the eve of the financial crisis, three quarters of Portuguese debt, half of Spanish and Greek debt, and more than 40 of Italian debt was held by foreigners.

Those who fear excessive public debt are the banks that hold it.