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

To: mishedlo who wrote (5029)	1/14/2004 10:55:06 AM
From: russwinter	Read Replies (1) \| Respond to of 110194

First, let me quote the key statement he makes that I agree totally with except the last two words, "US stimulus and China's investment were the driving forces in the massive global trade recovery'. I substitute the words "debt induced up-chuck" for "trade recovery". Secondily, what he's talking about MUST happen for the reasons I've been citing every day here. The monster US generated global up-chuck is causing massive distortions and misallocations. What are they going to do, wait until every last barrel of oil, and last pound of copper is consumed, plus some big time starvation sets in? Apparently so? The up-chuck (sic: recovery) has just outstripped all available capacity, so of course I don't think it's sustainable. It's is already hitting (past tense now) a wall. However, unlike most of these analysts and Fed officials who fiddle while Rome burns, I expect the solution will be the biggest catharsis we've seen in decades, if not longer. And that is especially true if your theory about another year of one percent FF rates holds water. In my scenario Chinese "trade growth at half the rate of 2003" will be a moot point. I DO NOT see the soft landing or adjustment everyone is so complacent about.