Talk about a picture being worth 1,000 words. Take a look at this.
The Debt Doomsday crowd has been telling us, forever, that interest rates were going to spike if the Government's debt keeps growing. The debt went from $800 bln in 1980 to nearly $16 trillion now, and the rate on a 10yr Treasury went from 15% to 1.5%.
Enjoy and don't forget to send to your friends who keep warning you about the debt. (rates in red, right scale, debt in blue, left scale.)
5 comments:
Zero correlation between interest rates and total debt. Negative correlation in fact. But that won't stop even one of them from claiming that rates will begin to spike any day now.
If I were into tattoos I'd almost want to have that chart tattooed on my butt for ease of presentation every time I hear the 'zomg interest rates!' palaver.
http://www.youtube.com/watch?v=SmsYQrIhLC8
"If I were into tattoos I'd almost want to have that chart tattooed on my butt"
You need to split it into 2 halves for viewers clarity
"Long term interest rates tend to be an average of current and expected short term rates" (http://bit.ly/MHi1Nx)
That is Gary Becker. Even the Chicago school recognizes the silliness of these arguments.
Awesome stuff, thank you and keep coming with these, will be back again.
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