Conversation With My 14 Year Old Son
I do not have a son, or daughters either. But I did receive an email from "Clyde" who does.
Clyde Writes ...
Good day Mish
I had an interesting moment with my 14 year old son the other day. I had gone to the US Debt Clock website and was taking a minute to just watch the numbers roll up and down in the various amounts.
The site breaks down the debt into a per person amounts. It is quite depressing.
My 14 year old son walked by and I had him take a look at it all, explaining that someday my son, all this will be yours.
His first words were "Why the hell should I have to pay that back?"
I found that comment interesting in that he does have a point. It's not like the money that has been borrowed in the past has been used to create world class infrastructures or world class anything. The vast majority of all the money borrowed by the government decade after decade has been just thrown down every conceivable rathole.
Imagine if his entire generation comes to the same conclusion someday.
Thanks for all your great work, I appreciate reading your writings everyday.
Hello Clyde. You have a very bright son. His generation should not have to pay that debt back. Indeed, his generation cannot possibly pay that debt back even if they wanted to. Given enough time, his generation will be in charge and decide enough is enough and default on that debt.
However, I expect a crisis long before that. The result will be anything but inflation. What cannot be paid back, won't be paid back. What obligations cannot be paid, won't be paid. That process is deflation, not inflation. Changing attitudes are proof enough. We are in the grips of deflation now, led by pension promises that simply will not be met while millions look for jobs that do not exist.
Friday, February 05, 2010
The bottom line: