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Debt, Deflation, And Debacle: Of Private Debt Write-Down And Public Recovery, Richard W. Vague, Robert C. Hockett
Debt, Deflation, And Debacle: Of Private Debt Write-Down And Public Recovery, Richard W. Vague, Robert C. Hockett
Cornell Law Faculty Publications
Most public discussion of the world’s continuing financial and macroeconomic troubles focuses rightly on debt. It focuses wrongly, however, on public debt. The real source of our ills is global-trade-related private debt overhang among millions of households below the top of the wealth distribution in the “developed” world. That is the provenance of both (a) the asset price bubbles and busts in whose aftermath we still struggle, and (b) the fact that we’re still struggling. Public sector debt growth in the developed world since 2009 is merely a symptom – the product of thus far failed treatment – of this …