[Aramike]

PD, only have time for a few counter-points so if I miss something, forgive me:

There absolutely isn't, I agree. Unless you knowingly pursue a risky path so you can report profits and not giving a damn about what COULD happen. It is NOT something they were forced to do. They were okay with taking risks, they LOBBIED Congress to be allowed to take risks.

This is only referencing 1 sector of the business community ... I was referring to business in general.

You certainly could be correct. But I don't think so. We'll find out sooner rather than later it looks like. Do you know of any bubbles in the market that ended up never popping?

I think where we're getting caught up is that you see it as a bubble and I see it as a stabilizing factor.

The international market is pretty much nothing more than a fiat economic system devised to create bargaining tools for trade relations. Ultimately, the REAL money doesn't come into play until actual goods and services are exchanged. That's why I don't believe there's any real "bubble". If it were to "burst" there would still remain the same essential supply/demand situations that existed to create the system to begin with, which is a circumstance unlike the housing market, for example.

The reason the world's economy took a hit along with ours is because when our housing bubble burst, American buying power was reduced significantly. The supply/demand hasn't changed - only the ability to satisfy the purchase itself. That's why a tax cut PLUS and infusion of American buying power could stabilize the situation.

I realize this. It's not something that anybody would do because they are pissed off at us, but simply because it may not be economically feasible for all those needed to to continue buying US debt. Can you guarantee that circumstances throughout the world will always allow the necessary amount of investment in debt to continue the smiling and winking?

They have no choice, and ultimately it doesn't matter. We live under a fiat economy - essentially, these governments could theoretically simply promise to buy the debt and it would be the same as an actual purchase. The international economic system doesn't really represent much except for bargaining chips relating to actual goods.

I'll bet that Madoff guy thought he could.

The difference is that Madoff was trading in empty promises and governments are trading in access to markets.

That was funny, though.

You can't make investments contrary to mathematics and expect them to work out indefinitely.

In this case, you actually can. What ultimately happens is that the mathematics are simply changed to accomodate the investments.

Edit: I must add one important factor: It WOULD be possible for our debt to be called in if American buying-power was sufficiently reduced. That's what my plan would address.