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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 (7513)2/10/2004 7:57:56 AM
From: russwinter  Read Replies (1) of 110194
 
This locked in liquidity is a legitimate thesis, and I don't dismiss it out of hand. But, where I depart company with it is that the liquidity CAN find it's way into the real economy (actually more accurately the markets) as inflation/speculation (not real economic growth). This can happen in a major way when the set up enters the crack-up boom phase. In otherwords as virtually every financial instrument has been exploited, and fundamental shortages develop from overheating and the terrific maladjustments caused by egregious policy, participants look for the real value.

Increasingly they will speculate and hoard real economy goods. This will really take off when the mainstream finally throws away the old playbook and gets the inflation "surprise" I've been talking about of late. Since the market has been deceived, fooled, and poorly prepared by Greenscam, the financial media, and Wall Street about inflation, you could see a a real stampede or panic into all kinds of commodities, or anything that represents real value (as opposed to financial or credit based). In many respect this process is well underway,
Message 19784518
and manifests itself (with only brief pauses) with the continual upticks in commodities, and continual downticks in the USD. This is why events such as the introduction of gold ETFs is so important. That could be the giant sucking sound vehicle that really gives gold cache.
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