Sprott on the economic crisis: ‘Debt has to be reduced, not increased by more deficits’

Image by Salvatore Vuono / freedigitalphotos.net *

‘”On both sides of the Atlantic, the largest contributors to the current crisis are excessive debt and spending. We are now at a point where additional government stimulus measures will have negligible, if not detrimental effects on the economy and long-term growth.”

“The historical evidence shows that countries with large governments and high levels of debt have on average, achieved lower economic growth. Given the already high level of debt and deficits in most developed countries, it is doubtful that increased fiscal stimulus will really help the recovery. It’s clear that debt is the problem and the solution does not lie in piling on even more of it.

“The current misconception that our economic salvation lies with more stimulus is both treacherous and self-defeating. As long as we continue down this path, the “solution” will continue to be the problem. There is no miracle cure to our current woes and recent proposals by central planners risk worsening the economic outlook for decades to come.” (Emphasis added) Eric Sprott & Etienne Bordeleau

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Government Debt per Capita: Quebec $38,725, Ontario $35,550 … Russia $ 1,247

G10 – Debt to GDP / ZeroHedge *

“Canada’s combined federal and provincial net debt will pass $1.1 trillion at 11 p.m. ET on October 3, (2011) according to a recent calculation.”

“Per capita debt is highest in Quebec and Ontario, where it has hit $38,725 and $35,550 respectively, and lowest in Alberta and the Yukon, where it has reached $14,700 and $14,900.”
Rachel Mendleson,  huffingtonpost.ca (1)

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