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

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To: UncleBigs who wrote (46486)	12/2/2005 11:18:42 PM
From: russwinter	Read Replies (1) of 110194

Legit question, but I would point out that the Fed has been growing it's SOMA account (monetizing) at an 8% annual rate over the last quarter, and rates are still creeping up, mostly because the FCBs were MIA until four weeks ago. Can the Fed really get away with even more monetizing? Look at all the goods and services going off like popcorn. I went out to dinner, and a movie last night and gagged, it just seemed like it suddenly cost 20% more, and I'm sure it did. Comcast which I use for phone, TV, internet raised prices 6%. All the inflation in the system is getting literally frenzied, it most certainly isn't just energy. Just don't think this is the environment for them to get going even more on the printing press, in reality they should back off, but they are trapped. I think this new effort to reign in toxic mortgages is an attempt to use a non-monetary method to eliminate this crowding out. If the demand for money is too high, and it can't be funded by monetization and FCBs, find an area of obvious excess and shut it down. That will relieve rate pressure to some degree.

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