# Federal Debt and the Cost of Money — RainbowStats replication
i = SERIES_SINCE(PNFI,19800101)
p = SERIES_SINCE(GDPDEF,19800101)
g = LOGDIFF(i/p)
y = SERIES_SINCE(GDP,19800101)
gy = LOGDIFF(y/p)
c = SERIES_SINCE(PCE,19800101)
gc = LOGDIFF(c/p)
r = toQuarterly(SERIES_SINCE(GS10,19800101))
dr = DIFF(r)
debt = SERIES_SINCE(GFDEGDQ188S,19800101)
d = LAG(debt,1)/100
dc = d-0.80
dc2 = dc*dc
n = SERIES_SINCE(A091RC1Q027SBEA,19800101)
j = 100*n/y
dj = DIFF(j)
ldj = LAG(dj,1)
m1 = REGRESSION(LIST(g,gy,dr,dj))
m2 = REGRESSION(LIST(gc,gy,dj,dr))
m3 = REGRESSION(LIST(gy,g,gc,dj))
m4 = REGRESSION(LIST(dj,dr,gy,dc,dc2,ldj))
system = SIMU_REGRESSION(m1,m2,m3,m4)
iv1 = LAG(dr,1)
iv2 = LAG(dr,2)
iv3 = LAG(gy,1)
iv4 = LAG(gy,2)
iv5 = LAG(g,1)
iv6 = LAG(g,2)
iv7 = LAG(gc,1)
iv8 = LAG(gc,2)
iv9 = LAG(dj,1)
iv10 = LAG(dj,2)
iv11 = LAG(d,1)
iv12 = LAG(d,2)
instruments = same_date_Range(iv1,iv2,iv3,iv4,iv5,iv6,iv7,iv8,iv9,iv10,iv11,iv12)
three = THREE_STAGE_REGRESSION(system,instruments)
quad = REGRESSION(LIST(dj,dc,dc2,dr,gy,ldj))
debt_chart = SET_TITLE(LINE_CHART(debt),"Federal Debt as a Percentage of GDP")
interest_chart = SET_TITLE(LINE_CHART(j),"Federal Interest Payments Relative to GDP")
rate_chart = SET_TITLE(LINE_CHART(r),"10-Year Treasury Yield")
growth_chart = SET_TITLE(LINE_CHART(gy),"Quarterly Real GDP Growth")
investment_chart = SET_TITLE(LINE_CHART(g),"Real Private Investment Growth")
consumption_chart = SET_TITLE(LINE_CHART(gc),"Real Consumption Growth")
debt_scatter = POLY_SCATTER(d,dj,2)
intro = TEXT_SLIDE("Federal Debt, Interest Rates, and Economic Growth","A dynamic four-equation model of investment, consumption, growth, and federal interest costs.")
method = TEXT_SLIDE("Econometric Method","Instrument projections followed by SUR/FGLS with Bartlett-kernel system HAC inference; a 3SLS approximation, not textbook 3SLS.")
conclusion = TEXT_SLIDE("Conclusions","A significant positive quadratic term suggests curvature, while interest-payment changes exhibit persistence. These conditional associations are not causal proof of a debt threshold.")
SLIDESHOW(intro,debt_chart,interest_chart,rate_chart,growth_chart,investment_chart,consumption_chart,method,three,quad,debt_scatter,conclusion)