How Good Does the Economy Have To Be?

The Fed reports that Americans are paying more for Debt service than ever before, somewhere over 13%. A analylitical statement of the Problem states the current level of Economic performance produced a 13% Debt service rate. Reduction of this Debt service will require an increase in Productivity, without an increase in this Debt. Here is the rub of the equation: Increased Productivity insists on increased Demand, functional only with increased Consumer debt, or expansion of the number of Consumers. Elimination of Consumer debt demands an expansion of markets.

The alternative states Productivity remain static throughout the course of Debt service repayment, Consumer Demand growing only as older Debt is retired. Many Models could be constructed to overview this Scenario, but this Author sees 7.7 years as rapid enough to replace necessary Demand, while 8.6 years as too slow to generate strong necessary Consumer Demand. Both are in the absence of debt service growth! Change in debt service(increase) would lengthen time of debt service, but would increase need for Consumer Demand. lgl