RealClearMarkets - Get Over It, We've Already Defaulted: "All of the above about banks is unfortunate given the historical truth that economies thrive on business failure for bad ideas being starved of capital, and poor bank managers being replaced by better ones. Also, not asked enough is why U.S. taxpayers are essentially on the hook to provide the world with an asset that at least in terms of the income streams it offers, will always pay. We're subsidizing a safe haven for capital; one that is paid for on the backs of productive workers who could doubtless find better uses for their hard-earned money assuming a less wasteful Congress and Treasury.
Still, all the talk about default is just talk since history says we'll continue to clip our creditors through dollar devaluations that will greatly harm economic growth. As for the other kind, Geithner has made it implicitly clear that a payment default of the more traditional variety is not in the cards, thus making it essential that happy talking Republicans who claim to believe in limited government walk away from the negotiating table as quickly as possible."
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