Saturday, July 13, 2013 | 2:02 a.m.
Economic icon and Nobel laureate Friedrich Hayek recently wrote that the U.S. government is no longer able to sustain itself. Tax receipts and government bond sales provide massively insufficient income to feed the federal monster. The Fed sold quantitative easing as a basis for stimulating the economy. While that may have been a consideration, it wasn’t as important as pretending the government wasn’t bankrupt.
Quantitative easing is akin to borrowing against your MasterCard to make minimum payments on your American Express Card. It works for a short period but reflects the death spiral that has overtaken the government.
An economic Armageddon is coming. The ending phase in every possible scenario is a massive depression.
This problem is beyond economics. Mathematics has assumed control, and mathematics is unemotional and relentless. The government is insolvent. The longer it postpones this reckoning, the bigger the defaults and greater the pain.