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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: russwinter who wrote (66939)7/26/2006 10:50:18 PM
From: Lee  Read Replies (3) of 110194
 
Russ,

What do you think of this explanation for why US interest rates are so low and the world keeps buying our mortgage debt?

aei.org

Here is a sample.

<snip>

U.S. Wealth Storage Services

The explanation for the stability--strength, in fact--of the U.S. dollar, even as the current account deficit has since 1990 risen from zero to 7 percent of GDP, lies with the globalization of wealth storage by rapidly growing countries--both advanced and emerging. Wealth is increasing rapidly in emerging markets, China of course being the largest, but also in Europe and Japan, not to mention the oil-exporting countries. The United States offers the largest menu of wealth storage options, not only in terms of variety, but also in terms of liquidity (defined as the ability to move huge sums--tens of billions of dollars worth) with only a small impact on price

<snip>

Lee
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