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: bond_bubble who wrote (51396)	1/25/2006 4:01:03 PM
From: GraceZ	Read Replies (3) of 110194

I was lending for less because if I dont, then govt was going to print money and give it at a lower rate!!! The money you lent at low rates ended up on the other side of RE buying. You have met the enemy and it is you. Why didn't you use it to invest in some sort of productive enterprise? BTW the primary RE lenders Fannie and Freddie are not government agencies, they are public companies. It was the demand for mortgage backed bonds which ballooned the amount of dollars available to borrow to buy RE. Low interest rates caused by a collapse in the demand for money for productive enterprises always boosts RE because lenders prefer the security of real assets in low interest rate environments. So what if the Fed has fooled the bond market? One should never base an investment decision on thinking that a large group of people, a whole market as is the case with the bond market, is somehow dumber than you are.

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