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How interesting. If, after 1999, the periphery's private sectors hadn't borrowed heavily from the core private sectors in what amounts effectively to vendor finance, there would have been a Eurozone-wide recession on the order of the intra-Eurozone trade imbalances as a fraction of GDP.

Which could have been met with lower interest rates, or that failing, financial stimulus.

So, how do you propose infrastructure spending in the periphery would have happened after 1999 in the absence of "credit card spending"?

The issuance of sovereign debt seems reasonable, as does private equity (not "private equity" as in LBO variety, but equity as in the opposite of debt) investment if the latter were not forthcoming at a great enough scale.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Dec 14th, 2011 at 09:24:08 AM EST
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