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

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To: bart13 who wrote (76329)	12/21/2006 1:17:15 PM
From: Real Man	Read Replies (2) of 110194

Yep. We'll have to see what happens here. The crisis will happen, but the exact scenario how it unfolds will depend on how the Fed acts. I think Russ is right - we should see some big "dump" after all the risklove "pump", but the reaction of the Fed to the dump seems very predictable to me - Ben Fed fears the depression outcome even more then AG Fed did. And yes, 500M a week monetarized is a drop in the bucket, but nobody said this Fed must stop at this number. They don't have to waste the paper to run the printing press anymore, so the coupon passes could grow to trillions, if needed. After all, Ben said he has this great weapon to fight deflation. So, there will be no deflation. In my opinion, if this Fed were to be responsible, they would be, already. Their main goal is not to enrich the Pig men, rather, to avoid the outcome of bursting bubbles at any cost, which could and will lead to more printing. They sure created a monster of a bubble-driven economy in the process.

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