Monday, March 5, 2012
Godley: Seven Unsustainable Processes (c. 1999)
Prof. Scott Fullwiler left a comment down thread where he referred to some projections the late Wynne Godley made in late '90's on what he viewed as seven unsustainable processes.
I've searched up a paper by the same name I found at Levy here.
Scott (to paraphrase) felt that all of Godley's projections have seemed to turn out as accurate at this point save those pertaining to the external sector. You can read for yourself but looks like Scott's assessment is fair.
Here is a link to a FRED chart that shows a cumulative total of "US Federal Debt Held by Foreigners".
Since Godley wrote this paper in 1999, it looks like the Federal external debt has increased by 400% from about $1T then to just over $5T now.
The FRED chart seems to be exhibiting a nice non-linear exponential increase over time.