Saturday, July 16, 2011

US Government Default

So it couldn't happen? Here is a quotable quote from a book I have been reading which dates to 1989, year the Berlin Wall was dismantled.

"In early 1988 I attended an international investment conference in Fort Lauderdale, Florida. Many of the delegates were shocked when one of America's top investment advisors outlined a depression scenario that put such a strain on US government finances that Washington would be forced to declare a moratorium on interest payments on bonds and Treasury bills. The odds are heavily against such draconian action, of course. But the point is that even such supposedly risk-free securities as American Treasury bonds could conceivably be hit if conditions were bad enough."

Gordon Pape, "Low-Risk Investing"