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

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To: dpl who wrote (71397)10/8/2006 1:57:43 PM
From: bart13  Read Replies (1) of 110194
 

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The key word here is "talked".That is all that happen.Just talk.
By this time two years passed.

Now multiply this several fold and remove the chance that another bigger asset can take RE's place and you can see what will happen.You will get deflation first and then inflation later(maybe).

Will the Fed do something crazy like drop money from the sky.Yes they will.But they will do it AFTER we are already into deflation.
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I'm not sure if its just semantics, but the Fed actually did start to do stuff before much SHTF in 2001-2. They started kicking up base pretty hard in very early 2001 and TOMOs were still running at over a 20% annual rate of change up into early 2001 too.
From there up until about 10/2002, TOMOs & TIOs ran at a rough average of 7% and then jumped up to a high of about 45% annual change rate in 6/2003.

I think my main point here is that I think they did actually know what was going on but chose not to "manage" the situations - they were attempting a "Volcker lite".
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