What are the costs of an externally financed deficit and when do the costs occur? and Museum of American Finance

What are the costs of an externally financed deficit and when do the costs occur?

What are the costs of an externally financed deficit and when do the costs occur?


Finance best answer:

Answer by NetAdvisor
The costs occur every day in terms of interest. The risks are we give up US assets to foreign entities and foreign countries.

Note: The FED has about 1/2 of their balance sheet holding these bad mortgages.

http://en.wikipedia.org/wiki/Deficit
http://en.wikipedia.org/wiki/Deficit_spending
http://www.epi.org/content.cfm/webfeatures_snapshots_09142004
http://pfr.sagepub.com/cgi/reprint/8/3/323.pdf

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