The debt will yield a profit one day? That is simply delusional. It's based on the notion that somehow the old, over-inflated market values will return "when the economy recovers". Except that the old, over-inflated market values were based on debt in the first place. So basically the only way this bad debt will "yield a profit" is if more bad debt is generated.
No, debt is not bad if it is 'paid back', even if that is just with printed money. We have gone through this before Beet - the first depression was eventually followed by increased asset values. How? Printing money in enormous quantities.
But what the government needs to do is to start recognizing losses, the sooner the better.
What the hell difference will 'recognizing losses' make? You simply have to make economic activity occur again.
Oh yes, and Bush will go down in history as the President who presided over the downfall of America, although to be fair he was a clueless idiot, and it is Mr. Greenspan who should have known better (and mayhap he did).
Edit: Though I am afraid to say, but is true, most of the visible deterioration will likely occur under Obama.
Oh please. There is no need for this - we're having a depression, a deflation. This is entirely a phenomenon created by bad State policy enforcing a certain kind of behavior on the masses. We can simply change these policies, just as has been done before. The solutions are right there in the history books, and there is no need to accept a 'downfall' just because of a psychological phenomenon.
