Re:Credit-Card Debt Nears $1 Trillion as Banks Push Plastic
by ArkyBeagle on Saturday May 21, 2016 @03:29PM
(#11745836)
The Household Debt Fallacy is a specialization of the Fallacy of Composition.
1) The debt is eclipsed by GDP rise over time.
2) A government ( at least used to ) be able to very slightly weaken its currency to equalize for GDP and population growth.
3) Mild inflation acts to equalize the effects of private debt as well.
I use the metabolic analogy because the risks of no body fat and low body fat are quite different, much as the risks of mild inflation and no inflation - or more accurately, deflation - are quite different.
1) The debt is eclipsed by GDP rise over time. 2) A government ( at least used to ) be able to very slightly weaken its currency to equalize for GDP and population growth. 3) Mild inflation acts to equalize the effects of private debt as well.
I use the metabolic analogy because the risks of no body fat and low body fat are quite different, much as the risks of mild inflation and no inflation - or more accurately, deflation - are quite different.