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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: russwinter who wrote (11326)4/6/2004 10:51:37 AM
From: Silver Super Bull  Read Replies (3) of 110194
 
RW,

RE: "I'd definitely hang on to gold unless there was a high probability the Fed would get aggressive about rate increases."

I've been thinking how the "train wreck" will play out. Assume prices continue to surge for many input materials and commodities, causing real damage to the economy. Then what? Like you say, a main tonic to surging inflation would be to raise rates - aggressively. But I think everyone knows how toxic that would be to the economy. So how about the alternative - offset the negative effects in the economy with substantial monetary injections - perhaps glimpses of Bernanke's "helicopter drop" come to mind...

I know, it may sound crazy, but it seems like every time a crisis of any type arises the result is aggressive monetary injections.

DB
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