Guest Post: About That $20 Trillion In Public Debt…

Friday, March 23, 2012
By Paul Martin

by Charles Hugh Smith
ZeroHedge.com
03/23/2012

In only three more years you’re talking $20 trillion in public debt for the USA and a GDP going nowhere fast. And what does that look like in terms of the S&P 500? Courtesy of frequent contributor Chartist Friend from Pittsburgh, here is the SPX charted against total public debt. You’ll notice it’s crashing:

What this chart reflects is another aspect of the death spiral I described yesterday in The One Chart That Says It All: when depreciation outstrips new investment, then productivity, income and profit all decline. As interest on skyrocketing debt rises, then more income must be diverted to service debt, leaving less for new investment. That sets up a positive feedback loop, i.e. death spiral.

The Rest…HERE

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