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

To: NOW who wrote (6732)	2/2/2004 1:18:30 PM
From: yard_man	Read Replies (1) \| Respond to of 110194

rise in insurance of all kinds has to do with the difficulty in finding high real returns in assets of the proper risk category ... it is inflationary from the narrow POV of labor costs -- but long run it is deflationary, IMO -- 1) one part of the input cost squeeze 2) it will keep hiring in check 3) it is symptomatic of real returns on financial assets dropping -- a trend that will continue Insurance increases don't have anything to do with capacity utilization or the tightness of production that russ is talking about. For the medical insurance in particular, you do have a bit of a problem of demographics in the US -- just like in soc security, but I think also we are adjusting excesses built up in the bubble (just go to the doctor -- who cares about the costs since we aren't paying directly)-- where other input costs were falling faster than medical costs rose -- so no-one paid attention so much to medicals costs, but now that the general input cost squeeze is on.