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Non-Tech : Deflation

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To: JF Quinnelly who wrote (220)1/16/2004 10:01:12 PM
From: Maurice Winn  Read Replies (1) of 621
 
I've been waiting for two years for interest rates to start going up again. It's taking longer than I thought, so there is obviously still some fear of deflation and implosionist economic forces.

Maybe there is an amazing economic situation where huge economic development can take place for years with low interest rates and low inflation. I doubt it. A return on capital of 0.98% [my US$ interest rate] is surely not going to last. P:E ratios are quite high too. That means capital doesn't have anything spectacularly profitable to do and might as well be spent on enjoying life before it's too late.

China's growth rate is 10% and has been for ages. Other countries are doing okay too. USA is booming along. Japan's deflation is out of steam.

I'm waiting for 7% interest rates again. The trend up surely will begin this year. It's boring waiting.

Mqurice
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