Who Are the Unnamed People Who Think the United States is Greece?

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Friday, 23 April 2010 05:12

That's what readers of a Washington Post article on the possibility of a default by Greece might be wondering. The Post told readers that:

"Other large nations, including the United States, that carry increasing levels of debt have worried that the Greek crisis could be a small-scale sketch of their own future. Sovereign debt is coming under increasing scrutiny by global markets, and many analysts fear that U.S. government bonds are not as attractive as they once were?

Of course "nations" cannot worry, only individuals within nations can worry, but the Post doesn't identify any who do. Nor does it identify the "analysts" who are finding U.S. government bonds less attractive. These analsysts are apparently offset by analysts who continue to view U.S. government debt as a very attractive asset since the yields on U.S. government bonds remain extremely low.

If there was an interest in making comparisons to Greece it would have been useful to remind readers that the United States government, unlike the Greek government, can print as much money as it wants to finance its debt during a period of economic weakness like the present. It also has a large diversified economy which is still largely self-sufficient, unlike Greece.

These differences make the comparisons to Greece highly inappropriate. While there may be people who make these comparisons as the Post claims, these unnamed individuals probably have little knowledge of economics.