YEAH BUT WHAT ABOUT THE DEFICIT SPENDING?

Well, it's not much of a problem, no matter what the gasbags say or write.

Deficit Cost Declines Give Obama Stimulus Clinton Couldn't Get
By Liz Capo McCormick and Susanne Walker - Aug 29, 2010 7:39 PM MT
BLOOMBERG

The bond market is giving President Barack Obama the green light to spend more money to boost the faltering economy.

While the government has increased the amount of marketable Treasuries by 70 percent to $8.18 trillion the past two years, rising demand has driven yields so low that interest to service the debt has fallen 17 percent so far in fiscal 2010 ending Sept. 30 from all of 2008.

With inflation so low, “fiscal-policy restraint is not a virtue, but a deflationary vice,” Paul McCulley, a managing director at Pacific Investment Management Co., which runs the world’s biggest bond fund, wrote in a report posted on the Newport Beach, California-based firm’s website on Aug. 13.

Besides the government, the biggest beneficiary of the drop in borrowing costs may be companies.

Johnson & Johnson sold $1.1 billion of bonds at the lowest interest rates on record for 10- and 30-year corporate securities on Aug. 12, according to Citigroup Inc. data going back to 1981. International Business Machines Corp., the world’s biggest computer-services company, raised $1.5 billion in the bond market on Aug. 2. The 1 percent rate for the three-year notes paid by the Armonk, New York-based company was the lowest of the more than 3,400 securities in the Barclays Capital U.S. Corporate Index of investment-grade company debt.