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: Horgad who wrote (88476)	11/5/2007 4:39:36 PM
From: GST	Read Replies (4) of 110194

Our economy is extraordinarily dependent on international trade in goods, services and capital that it is hard to overstate the impact of a sharply lower dollar. Living standards in the US will on average go down and we will buy less -- anybody who has ever lived in a "poor" country will easily explain that when you are poor you don't automatically find people rushing in to sell you things at a discount. What we have implicitly assumed is that as we grow poorer in relative terms, people in other countries will find new ways to subsidize our living standards -- don't hold your breath. People in other countries are doing business with each other -- they have hundreds of millions of their own people to feed and to be clothed and housed and transported and educated -- they have their own markets and they have their own money. Wherever you live, drive to the worst part of town and look around -- do you see gas being sold at a lower price there? Do you see milk being sold at a lower price there? Do you think that somebody who is broke gets a lower interest rate? We have been subsidized these many years -- the subsidies are over.

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