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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: Andrew G. who wrote (95738)4/18/2001 1:24:21 PM
From: Archie Meeties  Read Replies (1) of 436258
 
The credit bubble stops when faith in the underlying creditor is shaken. As long as the currency of the creditor is perceived as a safe haven from global financial crisis, then credit expansion can occur ad nauseum without jeopardy, for the fed and her banks know that they are not limited by trade imbalances, lack of savings, or even a stable equity environment. Without this faith, the creditors attempts to expand credit are met with currency devaluation, which weakens faith further.
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