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

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To: John Vosilla who wrote (90919)	1/30/2008 7:03:52 PM
From: Rarebird	Read Replies (4) of 110194

<<It is all about saving the banks at any cost.>> Is Ben Bernanke the financial savior here? I think not. Sure, as Fed chairman, Big Ben desperately wants to ensure that no major US financial institution goes broke. As Fed chairman, Big Ben thinks he can write that insurance. The major problem in Big Ben's game plan is if the USD crashes. The US Dollar Index is currently trading slightly above the November 2007 low of 74.86. There is no support under that level. I know it is unthinkable for many, but if the US Dollar Index does plummet below 74.86, US Treasuries may be the next asset class to be sold hard. The break can happen at any time. Big Ben knows this. He knows (along with Sec. Treasury Paulson) that a US Bank can suddenly crash into bankruptcy at any moment. That is why he has panicked and lowered rates 125 basis points in one week.

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