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To: zonder who wrote (267314)	11/14/2003 12:28:04 PM
From: mishedlo	Read Replies (1) \| Respond to of 436258

If housing does not collapse (or at least slow, even a modest 10% would do it IMO for the deflation scenario to kick in) Then yes the inflation scenario is alive, but only for the time being. At some point housing will bust 100% guaranteed IMO and that will be excruciatinly deflationary/ If stocks and bonds take a hit and employment does not rise, you have the deflationary trigger and I think it will happen. Everyone is worried about interest rate hikes. I ahave ahuge leveraged position in eurodollar futures, spreads, and short puts that says interest rates are not rising (or if they do, not buy much). Where you are correct is that greenspan will pull out all stops to save his reputiion regardless of how reckless that might be. Rates should rise because credit risk is enormous. But... If rates rise credit risk and default risk also rises. Greenspn is an impossible situation IMO (but one of his own making). I think if they rise it will be 1/4 or (1/4 then another/14 max) After that we do a Japan and rates head to .25% Unfortunately no one will have good enough credit to borrow at .25% and the money will just sit there. M