Comment: When the whole of Western Civilization is structured around debt, and the continued creation/increase of debt, implementing a “savings tax” and “mass write-offs” is only a temporary solution. Without a fundamental change to how money is created within the system, debt will continue to accumulate and sometime down the road, 5 years, 10 years, maybe 15 years, we will find ourselves back in the same situation, or worse. – JC
FROM THE TELEGRAPH
Debt burdens in developed nations have become extreme by any historical measure and will require a wave of haircuts, warns IMF paper
By Ambrose Evans-Pritchard
Much of the Western world will require defaults, a savings tax and higher inflation to clear the way for recovery as debt levels reach a 200-year high, according to a new report by the International Monetary Fund.
The IMF working paper said debt burdens in developed nations have become extreme by any historical measure and will require a wave of haircuts, either negotiated 1930s-style write-offs or the standard mix of measures used by the IMF in its “toolkit” for emerging market blow-ups.