by, 4th-June-2009 at 08:24 AM (838 Views)
... Deficits Threaten Financial Stability
“Unless we demonstrate a strong commitment to fiscal sustainability in the longer term, we will have neither financial stability nor healthy economic growth,” - Federal Reserve Chairman Ben S. Bernanke said large U.S. budget deficits threaten financial stability and the government can’t continue indefinitely to borrow at the current rate to finance the shortfall.
** coming so soon? Just as I was saying the rising yield spread is a sign that the market is forcing a brake on to his runaway QE train. His next move will determine if the current rallying equity/commodity market would continue. If the Chinese were to play ball, watch the US$ rebound to take away the punch bowl. Interesting time.