Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Heinz Blasnik- Views You Can Use -- Ignore unavailable to you. Want to Upgrade?

To: Perspective who wrote (3092)	7/21/2003 7:30:56 PM
From: Box-By-The-Riviera™	Respond to of 4904

i have something for you on that... will post it later tonite.

To: Perspective who wrote (3092)	7/21/2003 7:34:12 PM
From: orkrious	Respond to of 4904

Heinz, if you're out there - curious to hear your take on the bond market collapse. found this on his current hangout Date: Mon Jul 21 2003 15:46 trotsky (bond market) ID#377387: Copyright © 2002 trotsky/Kitco Inc. All rights reserved admittedly i'm surprised by this swift collapse...however, i'm more than happy to be wrong about bonds, since the enormous steepening of the yield curve is a huge positive for gold stocks. the last remaining prop to the US economy, the refinancing orgy that was set in motion by record low yields is now slipping away real fast...it is to be feared that recessionary dip nr. 2 will be a good sight worse than dip nr. 1. ironically, if that plays out, the bond market may be rescued once again. if not, it's going to be 'Argentina, revisited'.

To: Perspective who wrote (3092)	7/21/2003 11:17:15 PM
From: Box-By-The-Riviera™	Read Replies (3) \| Respond to of 4904

point counter point here's a dialogue without mentioning names: for deflation: 3 reasons: 1. we're in the K-winter. 2. global industrial overcapacities are clearly unresolved. see US capacity utilization, which keep creeping along below 75%. 3. the huge private sector debt overhang...it can't be 'inflated away' in a fiat system, unless they REALLY start dropping money from helicopters, and that won't happen imo. such debt overhangs have historically always ended in a deflationary debt collapse. re. bond collapse, the reasons for it may have nothing to do with fear of inflation - it may well be creditworthiness that is becoming the issue. if so, we're in for very turbulent times. imo the inflationists make the cardinal mistake of ignoring the transmission m.o. in the money creation process. the Fed created lots of free banking reserves in the Great Depression too. they rose by over 400% in the space of 2 years. but they couldn't force anyone to borrow the money, and so deflation took its course. if deflation were 'impossible' in a fiat system, why is there deflation in Japan? as soon as one finds the answer to that crucial question, it becomes clear why we're following the same road. counter point: currency was tied to gold in the depression. japan has a trade surplus (AND we bailed out their currency in 98 when inflaiton woudl have begun anyway)... if the fed want's to destroy the dolllar, they can and will.. end of story. can't have DOLLAR DENOMINATED deflation if the dollar is falling... PERIOD. it's a physical impossibility. we will have periodic deflationary shocks as the system grinds thru all the problems that have built up but the secular trend is inflationary not deflationary as far as the dollar is concerned. gold is telling you that. tri-counter point: Are they both right? and we'll end with a vicious form of stagflation, one that rotates through the various classes as we have seen thus far in a contrapunctal deflation/inflation pincer movement... squeezing both sides of price, demand, and supply?