The Epic American Credit and Bond Bubble Laboratory Message Board

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

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To: Square_Dealings who wrote (26750)	2/19/2005 10:01:09 AM
From: John Vosilla	Read Replies (1) of 110194

In 1929 we had the stock market in a mania stage with 90% debt and the major cities in the northeast in a commercial building boom even though monetary policy had been tightening for a while. The yield curve was pretty flat in the 6% range, homes were not highly leveraged, savings rates were still high even though consumer spending and borrowing was at records not seen up till that time and we had budget and trade surpluses. Now compare then to today's imbalances and it is downright scary. Perhaps Fannie Mae at over 4 year lows is one of the first signs of perhaps a major credit bust coming and reversal of the carry trade benefits.

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