Quote:
Originally Posted by Mike Parker
Is there a quantitative test for government solvency under open economy conditions? Like you, I’m very interested in the information content of market prices. Does the Treasury market consider USG bankrupt?
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We have an open economy? What do you mean by that term? I don't know the technical meaning of bankrupt, if there is a special definition for government bodies, I'm using it in the everyday sense. Of course the government in a sense can't truly go bankrupt when it can simply print notes to pay off its debts. But it amounts to the same thing.