The world's largest debtors are facing the price of their borrowing habits.  The price is disaster--for citizens left victims of excessive government borrowing. Investors trade mountains of paper every day with a price: that price is what people are willing to pay, given their best estimates of information they possess now, and what alternatives they may have.  It is not the price when the paper was issued, not when it will "mature", not when times will better, nor when times will be worse.  It is what people must pay today to own the paper today, and what people who are selling the paper must accept as the best they can get. Such obvious facts are potent, particularly when doing the math on default.  Today the world's third largest issuer of paper known as bonds is Italy. Italy has bonds outstanding of $2.6 trillion--and Italian bonds are in trouble. That means buyers are not willing to own them today unless they receive high compensation--higher than any other...(Read Full Post)