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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (287)	7/25/2003 11:23:37 AM
From: ild	Read Replies (2) \| Respond to of 110194

Global: Long Live the Output Gap Stephen Roach (New York) morganstanley.com

To: russwinter who wrote (287)	7/25/2003 12:01:31 PM
From: Little Joe	Read Replies (1) \| Respond to of 110194

Russ: I understand your position quite well and agree that it is a likely scenario. I readily admit that I am not smart enough to predict how it will work out. I am however convinced, as I believe that you are, that the price of gold will go higher no matter. Where we disagree is in the assumption that higher rates will kill the housing boom. I believe that it is possible and given the gov's propensity to inflate that we will see wage inflation which will enable people to pay off their debt in Chinese Dollars (by the way I am not so sure that currently this term has the meaning intended) some time before the deflation sets in. I think this scenario is just as likely as one where the housing bubble bursts now and prices start to drop. Little joe