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

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To: bart13 who wrote (75796)	12/15/2006 10:43:37 PM
From: kris b	Read Replies (1) of 110194

I figured if you felt that strongly about it, you'd want to get your opinion more widely spread -- nothing more complex than that. I don't care about spreading my opinion widely. I simple want the people who make certain claims to prove them logically, through well supported analysis. Several bloggers on this thread are making statements about THEM printing, flooding, helicopter drops, etc. causing hyperinflation. I am just a simple schmuck who would like to learn how all this liquidity will find its way into the pockets of the households. So far, not even one hyperinflationists could explain it to me. Even with current $ 450 (Down from $ 700 Billion, 7% of GDP, last year. Big hit to the household's cash flow) Billion annualized MEW extraction, the households are on the ropes with demand deposits down to 9.5 days of funds and all checkable deposits down to under 20 days of funds. In order to create consumer (we already have asset hyperinflation) hyperinflation liquidity has to be injected into the economy causing mad scramble for limited quantity of consumer goods. Until somebody can show me how it can be done I am leaning towards deflationary collapse of the credit/housing bubble. Some people would say Pig Men of the Wall Street Mafia can carry the economy. I have my doubts. Lets say that the combined income (including all the bonuses) of all parasites shuffling the paper is $ 1 Trillion, this is only 10% of the entire household income of $ 10 Trillion. Can 10% support the national economy while the other 90% is going broke? What happens to the economy when MEW goes back to pre-bubble level of $ 25-50 Billion per year? Can somebody please explain to me what will replace the missing $ 650 Billion? Where is the next asset class that can be monetized to the same extent?

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