Thread by @RayDalio

@jtgaut17 @FT I don’t think we disagree. Let’s see. I believe that using money and debt creation to pump up the economy is both unavoidable to prevent disastrous results and the main reason for our biggest problems. The accumulation of these pump-ups makes the long term debt cycle which...

@jtgaut17 @FT ...pushes up debts and pushes down interest rates until that reaches its limit when interest rates can’t be lowered any more (i.e. when what I call Monetary Policy 1 no longer works, and when printing money and buying financial assets, which I call Monetary Policy 2...

@jtgaut17 @FT ...no longer works). That is where we now are in the long term debt cycle. Then policy makers have to use what I call Monetary Policy 3 which is explained in my book “Big Debt Crises” which you can get for free as a pdf or buy on Amazon.

@jtgaut17 @FT It is as though the economy can not live without the money and credit addiction without going through a terrible withdrawal but it can’t sustain that addiction without using Herculean efforts of decreasing effectiveness until that fails.