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: TimbaBear who wrote (71770)	10/12/2006 3:43:19 PM
From: John Vosilla	Read Replies (1) of 110194

'Why can't you just acknowledge that there exists multiple approaches each with interesting arguments to their credit? ' Because the neocons attempt to control the game here too. Only instead of being labeled a liberal you are being labeled a hyperinflationist for not staying in the fold. Meanwhile the DOW at all time highs, we have our RE bust, liquidity runs as free as ever and our banking system remains as solvent as ever in a very low interest rate environment. Probably not the way some like it but it seems to be the cards dealt for now.. On your other post I always thought higher interest rates = higher dollar as an offset to higher inflation = lower dollar. The main reason I feel higher interest reduce values is multiples to cash flow versus the risk free rate need serious adjustment that can only be made up by higher margins and strong top line growth as an offset. Take 4.7% which equates to 21.3 risk free multiple versus at 7% the risk free multiple drops to 14.3..

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