Risk Free Debt

["John Gelles" <jjgelles@xxxxxxxx>]

            Davidson and Galbraith ought to have suggested
            a zero-interest US bond, callable and cashable at
            any time.

            The bond until called would be corrected upward
            daily for inflation in a defined basket of essential
            consumer and capital products, based on, say, a 180
            day moving average. Downward changes would be
            recorded and averaged, but not applied to the
            call or cash-in value -- which would stay fixed until
            next raised.

            Thus investors would have a risk free asset in real
            economic measure which paid its proper zero return.

            The US budget would not be burdened with interest
            payments.

            Any nominal cost for inflation would be free to all
            parties, since it is implied that government would not
            resume borrowing from anyone but its own central
            bank, and then not by issuing marketable securities. .

            Government would still have to avoid severe
            inflation if it wanted democracy to survive.

            The coast would be clear for a fairer return to labor,
            when risk-free capital's acknowledged reward was
            avoidance of capital loss.

            Paul thinks they are prophets.  Generous.  I think
            they are wonderful people -- having met them.  But
            who would want to be a prophet in a non-ergodic
            world?  All is unpredicatble -- so a prophet must
            be suspect if he says a word.


        John Gelles
         email    1944@xxxxxxxx
             url    http://1944.org