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

To: russwinter who wrote (3177)	12/11/2003 10:35:15 AM
From: ild	Read Replies (1) \| Respond to of 110194

Asia Pacific: 2005 Forecast: Hugging the Trend Again Andy Xie (Hong Kong) morganstanley.com

To: russwinter who wrote (3177)	12/11/2003 12:46:42 PM
From: Jim Willie CB	Read Replies (2) \| Respond to of 110194

I simply dont understand why people expect lower LT rates makes no sense last year, maybe next year, never not with monetary expansion taking effect not with Asian currencies rising (they are our mfrs) not with commodity prices on the rise I have to laugh at two items in the news today story #1: IMPORT PRICE INFLATION +0.4% (NOV) EXPORT PRICE INFLATION +0.5% (NOV) so the lower USDollar has resulted in higher export prices??? this trade deficit will continue to bleed in hemorrhage style for many more months, with no correction, until JYEN rises another 20-30%, and until the YUAN is repegged at 30-50% higher story #2: US Taxpayers paid for the Iraqi liberation and reconstruction bullshit Asia did it was all done on a credit card by a bankrupt USGovt federal deficits are $550B this year ($850B counting SS raid) / jim

To: russwinter who wrote (3177)	12/11/2003 6:33:08 PM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 110194

Add that term to "currency defense", and you have the formula for 2004 there are only two ways for a country to directly defend its currency: Door Number 1: Sell other currencies for the national currency. this option is not open to the US since we do not have significant forex holdings (especially when compared to foreigners' holdings of USD) Door Number 2: Raise interest rates. this option is the one i believe the Fed will AVOID AT ALL COSTS, for reasons previously enumerated. therefore, in terms of currency rise, all that can be hoped for is: Shoji Number 3: Hope that the Japanese continue to buy our confetti and do our work for us. unfortunately this door is made of paper and not very useful. the Japanese have tried to prop up the Dollar for 30 years and have watched the JPY appreciate from 360 in 1971 to 108 today. relying on other nations' CBs to defend the dollar is not a viable long-term strategy. and i see no reason to believe Door Numbers 1 and 2 are of any interest to Greenspan. and as to the old saw about the Fed only controlling short rates: Bernanke and Greenspan have explicitly reminded the markets numerous times that there is "ample precedent" for the Fed to extend its activities to all and sundry longer dates. in other words, they can monetize whatever the hell they please. taken to its logical extreme, i suppose this gets us to the "dropping dollars from helicopters" scenario, but i suspect even the CBs are scared of going that far. however, i believe in the short and medium term they can have a significant impact on just about whatever they please, in terms of market rates.