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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: Jim Willie CB who wrote (4153)12/30/2003 1:15:17 PM
From: Crimson Ghost  Read Replies (2) of 110194
 
Jim:

My dollar take a little different. Inflationary monetary policy and weak dollar do help the US economy to a certain extent short-term. Especially the profits of multinational corporations and the net worth of domestic asset holders.

But in the past these have been rapidly offset by surging interest rates as the bond vigilantes moved to protect themselves from the inevitable jump in inflation.

But the Fed together with Asian CBs has temporarily short circuited the interest rate and inflation responses. So the US economy and financial markets have enjoyed the positives of a weak dollar without suffering the negatives YET.

But watch out below when these negatives start to manifest themselves or more likely when the markets begin to discount them.
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