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

To: ild who wrote (4363)	1/4/2004 5:01:59 PM
From: yard_man	Read Replies (1) \| Respond to of 110194

re CI -- I agree with the excerpt below from CI -- watch the trade deficit, i.e. consumers propensity to take on debt -- rates will rise when we can least afford it from a timing pt of view. Now, if the USD is going down vs other currencies -- isn't this correct: it is not necessary for the deficit to contract in nominal terms, it just needs to contract in real terms to signal trouble ahead?? >>As crazy as this may sound, if our trade deficit were truly to contract meaningfully ahead, we would expect foreign flows of capital into the US to likewise contract, clearly pressuring US fixed income prices. But we're not there yet. Certainly the foreign community could also decide to place their capital elsewhere in the global sphere, but foreign purchasing of US financial assets has much less to do with investing than with promoting and sustaining their export driven economies. <<

To: ild who wrote (4363)	1/4/2004 5:10:45 PM
From: yard_man	Read Replies (1) \| Respond to of 110194

I'll check that out -- I would add that if you believe the housing and debt bubbles CAN be maintained, then you do want to have a good position in gold. Such an expansion would be indicative of low rates forever and commodities would do very well under that scenario.

To: ild who wrote (4363)	1/4/2004 5:11:10 PM
From: russwinter	Read Replies (3) \| Respond to of 110194

Of course I consider BCA conclusions and reference to "old dead bears" quotes from 1956 and 1978 to be bogus, and warranting of a poor score on the debate squad. My rebuttal to them, is to direct you to the following charts (19, 20, 24, 25) at the Hoisington presentation. Then compare current circumstances with the bogus dates (or any date you choose) BCA uses: Message 19632973 And while you're at it, check out the interesting chart 22 on "residential rental vacancy rates". Should dispel all (but the most fuzzy, head in the sand thinkers) from the notion we are in a housing shortage, especially one necessitating record high SF housing starts. Check out the housing starts chart 21 too, in case you were wondering if: 1. there's still any pent up demand left (besides speculation and nutty behavior), or 2. what true housing cycles have looked like in the past half century (before Easy Al decided to try and abolish the cycle that is). The next housing down cycle will truly be one of the main daggers that kills this vampire.