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To: pater tenebrarum who wrote (95728)	4/18/2001 12:24:51 PM
From: sammaster	Read Replies (1) \| Respond to of 436258

interesting that fnm down today...despite rate cut who was that with the credit problems?

To: pater tenebrarum who wrote (95728)	4/18/2001 12:33:14 PM
From: Andrew G.	Read Replies (3) \| Respond to of 436258

Heinz: "the credit bubble must keep expanding exponentially, otherwise it will collapse. We keep coming back to this. You know I respect your opinion. But I disagree entirely on this point. How can it keep expanding exponentially WITHOUT collapsing ??? I keep searching for some one to explain where the threshold is likely to be and no one has yet pointed out what circumstances would precipitate a collapse. It seems there is no limitation on the credit bubble EXCEPT that all borrowers meet their minimum monthly payments. They can do that in a environment of lowered rates and aggressive buying of corporate bonds. This is the current environment. There are currently NO incentives to save or pay down debts. Small companies with $billions in debt is not uncommon anymore, extrapolate that out to the many who have not even borrowed into their maximum capacity and you may not see the proverbial 'Credit bubble burst' for another 10-20 years from now. Don't point out the WCII and ETYS, PSIX type examples because there are tons of them and yet it has had zero impact on the equity market or on the enthusiasm for corporate bonds. Look at the wild enthusiasm for telco bonds. When will that dry up ?