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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: TH who wrote (96294)8/15/2008 1:52:32 AM
From: glenn_a  Read Replies (1) of 110194
 
Thanks TH.

((I've always thought that Mish's deflation view had a very high probability of being THE end game of this massive and unsound credit expansion. ... Inflation has been and is the M.O. of our completely irresponsible Fed. That will continue until it can't.))

Well said.

((Lately there seems to be more talk of deflation now, as the deleveraging is creating some short-term impacts that might be incorrectly labeled as such.))

That is my "feel" of the current correction in commodity prices, in particular ... my "feel" is that a significant portion of this hedge fund deleveraging, but not a situation that represents underlying supply-demand fundamentals. But I'm open to being proved wrong on this.

((I consider this recent commodity smackdown as cover to hold rates in the US and sell this interest rate differential nonsense as a reason to buy the dollar and give the Fed breathing room.))

Interesting. I hadn't thought of it quite that way.

((The inflation data today was probably allowed to go out hot (meaning not as adjusted as it has been for the past few YEARS) in an effort to convince the mindless wall street squirrels that it is actually meaningful/accurate and not yet reflecting the oil and everything real correction.))

Hmmm.

((It is a bizzare and twisted situation.))

So it is. So hard to differentiate between "illusion" and "reality".

Thanks again for your thoughts TH.

glenn
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