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Non-Tech : Money Supply & The Federal Reserve -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (961)	8/20/2003 10:04:38 PM
From: glenn_a	Respond to of 1379

mishedlo. "Do bonds fall, stock market rise, both, neither?" IMO, at some point you have a massive liquidity crisis. When this occurs, liquidity gets sucked out of ALL financial assets. Cash is the holding of choice in this environment (ensure your bank is credit-worthy, or definately "too big to fail" - whatever that means exactly). Physical gold bullion should hold its value relatively well. Long-term, the US$ is end a secular downtrend ... as a store of value, it weakens against all other major currencies IMO. The global economy contracts ... in fact, seizes really ... all in all an ugly picture. I think there's a reasonable chance the fun times could begin this autumn ... in the Sep't/Oct period. Or it could be forestalled for a year or two ... though it will really take a miracle IMO. What would convince me I was wrong in my assessment (Morgan Stanley's Chief Economist Stephen Roach frequently asks himself this question, I think it's always a good one to ask)? Boy, that's a tough one. Honestly, I guess if I saw signs that the global elites and monetary authorities were facing the situation with humility and honesty. If significant moves with legal teeth were made towards greater transparency and accountability in business and government. If powerful states began to assume responsibility for their actions and realize the "karmic effect" of past and current behavior, rather than completely disassociating cause from effect, with its consequential labeling of peoples into "good" and "evil" (which is unbelievably simplistic and dishonest). If developed world consumers, businesses, and governments took significant steps to reduce their debt and live within their means. If greater generosity and less selfishness was shown by the "haves" of the world to the "have nots". And if a stewardship approach to global society and the environment were the norm rather than selfish behavior designed primarily to protect the "interests" of the few (relatively speaking). IF I saw this momentum building, THEN I would begin to have hope for my children's children's generation. Say 20 years down the road. Not sure if the current system is able to be saved or not ... or is even worth saving. Alas, the American empire appears destined to implode under the weight of its own corruption ... not unlike its Soviet brethren did over a decade ago. Pretty bleak assessment eh? Thank God I took my Paxil this morning! LOL! Regards, Glenn