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To: UnBelievable who wrote (13685)	8/24/2000 5:27:44 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 436258

actually the cause-effect relationship is a little more complex imo. i think that first the limit of credit expansion must be reached, as the debt burden becomes too excessive for households to justify further increases in indebtedness - probably going hand in hand with saturation once everyone has all, or most of the gadgets deemed desirable. then, as credit demand falters, key economic data should begin to show a noticeable drop-off in demand, and the associated slowing of economic growth should make the dollar less desirable. the Fed is then going to attempt to avoid a too severe credit contraction by doubling its printing efforts and lowering rates...thus undermining the current positive rate differential. then the effects you cite will kick in, or rather the various processes will reinforce each other in a progressively accelerating spiral, not unlike the mania in financial assets to the upside, only the direction will be reversed.

To: UnBelievable who wrote (13685)	8/24/2000 5:27:45 PM
From: pater tenebrarum	Respond to of 436258

actually the cause-effect relationship is a little more complex imo. i think that first the limit of credit expansion must be reached, as the debt burden becomes too excessive for households to justify further increases in indebtedness - probably going hand in hand with saturation once everyone has all, or most of the gadgets deemed desirable. then, as credit demand falters, key economic data should begin to show a noticeable drop-off in demand, and the associated slowing of economic growth should make the dollar less desirable. the Fed is then going to attempt to avoid a too severe credit contraction by doubling its printing efforts and lowering rates...thus undermining the current positive rate differential. then the effects you cite will kick in, or rather the various processes will reinforce each other in a progressively accelerating spiral, not unlike the mania in financial assets to the upside, only the direction will be reversed.

To: UnBelievable who wrote (13685)	8/24/2000 5:27:50 PM
From: pater tenebrarum	Respond to of 436258

actually the cause-effect relationship is a little more complex imo. i think that first the limit of credit expansion must be reached, as the debt burden becomes too excessive for households to justify further increases in indebtedness - probably going hand in hand with saturation once everyone has all, or most of the gadgets deemed desirable. then, as credit demand falters, key economic data should begin to show a noticeable drop-off in demand, and the associated slowing of economic growth should make the dollar less desirable. the Fed is then going to attempt to avoid a too severe credit contraction by doubling its printing efforts and lowering rates...thus undermining the current positive rate differential. then the effects you cite will kick in, or rather the various processes will reinforce each other in a progressively accelerating spiral, not unlike the mania in financial assets to the upside, only the direction will be reversed.

To: UnBelievable who wrote (13685)	8/24/2000 5:28:03 PM
From: pater tenebrarum	Respond to of 436258

actually the cause-effect relationship is a little more complex imo. i think that first the limit of credit expansion must be reached, as the debt burden becomes too excessive for households to justify further increases in indebtedness - probably going hand in hand with saturation once everyone has all, or most of the gadgets deemed desirable. then, as credit demand falters, key economic data should begin to show a noticeable drop-off in demand, and the associated slowing of economic growth should make the dollar less desirable. the Fed is then going to attempt to avoid a too severe credit contraction by doubling its printing efforts and lowering rates...thus undermining the current positive rate differential. then the effects you cite will kick in, or rather the various processes will reinforce each other in a progressively accelerating spiral, not unlike the mania in financial assets to the upside, only the direction will be reversed.