From Investment Postcards from Cape Town:
Following the latest US Flow of Funds Accounts report, Nathan Martin of the FedUpUSA blog produced a fascinating chart. As shown below, it is constructed by dividing the change in GDP by the change in debt. It shows how much productivity is gained by infusing $1 of debt into the U.S. debt-backed money system.
Martin explains the graph as follows: “Back in the early 1960s a dollar of new debt added almost a dollar to the nation’s output of goods and services. As more debt entered the system the productivity gained by new debt diminished. This produced a path that was following a diminishing line targeting zero in"...
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