Comment 33191

By A Smith (anonymous) | Posted September 03, 2009 at 05:55:23

Ryan >> It's almost as if the former was acting as a (temporary) substitute for the latter

Debt is nothing more than one person giving money to another. External debt is nothing more than one nation giving money to another nation. Because people in this world can't borrow from Martians, the NET DEBT of the world is zero. For every debt owed, there is someone who is a creditor.

Therefore, if our world isn't simply financing growth through external debt (borrowed from other planets), how can you argue that the growth that's being reported is not based on fundamental improvements in productivity.

>> the growth of the period after 2004 was really the inflation of a bubble

Using the exact same source that JonC used...

www.indexmundi.com/g/g.aspx?v=66&c=xx&l=en

Year GDP - real growth rate (%)
2000 3
2001 4.8
2002 2.2
2003 2.7
2004 3.8
2005 4.9
2006 4.7
2007 5.3
2008 5.2

Definition of GDP - real growth rate: This entry gives GDP growth on an annual basis ADJUSTED for inflation and expressed as a percent.

This is how the IMF reported REAL GDP growth from 2004-08...

tinyurl.com/l9toeq

Take a look at Japan's GDP(PPP) ( tinyurl.com/m4bsce ) and compare it with it's oil consumption ( tinyurl.com/kqaduo ). Assuming that you believe that GDP (PPP) figures represent real increases in living standards, it's clear that oil consumption is NOT a limiting factor. Many other countries also follow this GDP/oil consumption pattern, including the U.S.A.

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