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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 (3682)	12/20/2003 4:41:40 PM
From: mishedlo	Read Replies (1) \| Respond to of 110194

But the truth of the matter is that China is providing us with an extraordinary example of Credit inflation and boom dynamics. For now Where is wage inflation? Price inflation in finished goods? jobs? What have we bought other than massive debt for all this credit expansion? Look at the headline for that report No Inflating Out of this Quagmire That my friend is the correct assumption. What we are witnessing is a massive attempt to do the impossible. I do not think it will work, nor do I think it even CAN work. Here is the key snip "Global reflation has taken firm hold. Yet, as I have followed developments closely, I am more convinced than ever that it is simply not possible for central banks to Inflate Their Way Out of this Quagmire. There is no general price level to raise, and there is no general income level to inflate. Such notions are from a bygone era. And, importantly, central banks have been playing right into the hands of the Commanding Leveraged Speculating Community. The harsh reality is that the longer and more aggressively global central bankers accommodate inflation, the greater the leverage and speculation; the greater the size of weak debt structures; the greater systemic financial fragility. Importantly, there is no inflating out of gross financial leveraging and major speculative Bubbles." Global reflation will fail. Let the deflation begin. The sooner the better for all of us. M