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: jimmg who wrote (76476)	12/22/2006 8:56:54 PM
From: regli	Read Replies (2) of 110194

<i."... Things like Russ posting the low cash reserves are interesting but don't help me to gauge timing and magnitude of consumer behavior. With rapid borrowing and fast growing m-3, there is plenty of liquidity to fuel consumer purchases." I don't think it is about liquidity when it comes to the consumer. I believe it is about physical limits. The real question is how long consumers can continue to defy gravity in the face of record highs/lows in category after category. I am quite aware that there is the saying "don't bet against the U.S. consumer". However, given the charts below in addition to the one in my prior post, isn't it just about reckless for any investor to continue to invest as if the consumer has lots of upside left? Isn't it foolish to simply bank on a "this time is different" belief? If a chart shows an extreme, it is highly advisable to explain fundamentally why something can possibly continue to defy gravity. Simply explaining fundamentals away by hanging on desperately to a trend seems utterly irresponsible. contraryinvestor.com contraryinvestor.com web-xp2a-pws.ntrs.com

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