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

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To: John Vosilla who wrote (47651)12/19/2005 8:58:38 AM
From: UncleBigs  Read Replies (1) of 110194
 
If anything more and more signs continue to point to reflation being a success.

I don't dispute that reflation has been successful if you view a debt/consumption binge as successful.

The question is one of sustainability. Reflation based upon skyrocketing debt is obviously not sustainable. That wealth you see when you travel is fueled by an unsustainable rise in asset prices fueled by easy credit. Once the credit spigots slow down, asset prices decline and those people who thought they had wealth will watch it go to money heaven.

The smart money is selling. Selling houses, selling stocks. That wealth will be maintained. Wealth tied up in paper assets and real estate can and will vanish rather quickly.
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