SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : The Residential Real Estate Crash Index
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Elroy Jetson who wrote (24781)10/24/2004 10:34:59 PM
From: SouthFloridaGuyRead Replies (1) of 306849
 
The markets always tend to do what's most painful and in the case of debt holders that means deflation. However, if deflation were imminent one would see it manifested in widening corporate bond spreads and/or falling commodities prices.

Neither is apparent. Instead we are truly in what the Fed describes as a "soft patch".

So what is the catalyst for what we all think is going to happen? Well it's what many Economists like Kasriel and Roach have been shouting about - the $USD. The $USD's depreciation will cause commodity appreciation which will be further exacerbated by hedge fund/institutional speculation. Oil prices have barely dent the US economy as Greenspan said. That can only mean one thing - they will continue to go up until they do make a difference. We could easily see oil at $80 barrel by next summer in my opinion. Then I believe Greenspan will be saying something different.

This supply curve shock coupled with massive debts carried by US citizens and many corporations will finally the straw that breaks the camel's back and will send the U.S. into a major deleveraging recession and all that comes with it; deflation, unemployment, real estate/stock market crash.

Conclusion: 1) Stock Market and Real Estate market are finished. 2) Commodities are the place to be as a flight to quality play from a declining $USD. But they too will get killed once the recession rears its ugly head next summer.

In a deflation, cash will be king as will US treasuries.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News