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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 (8819)	2/27/2004 11:47:18 AM
From: russwinter	Respond to of 110194

Fantastic read on the dynamics of the bond market in the 2/26 CI. First you have 50% of new supply bought by BOJ bureaucrats whose agenda is mercantilism, not investment merit. Then you have a huge leveraged community, whose been green lighted (instead Greenspan should have been waving them off) by the moral hazard road show to continue on AGGRESSIVELY with the carry trade. That's why our XLF short never seems to want to turn down. At the margin you have bond managers like Bill Gross, sounding the warning bells, but I don't think even he has factored in how bad this is getting. The BOJ and leveraged guys are totally dominating and distorting the market. I think the latter will push the sell button some morning, and we will get a bond crash.

To: ild who wrote (8819)	2/27/2004 11:51:10 AM
From: Jim Willie CB	Respond to of 110194

because it is cost inflation without final demand pricing i.e. profit squeeze which slows the economy until China raises final product prices, this wil continue but I believe China is soon to do just that WalMart is the early warning signal, and they have begun we all are comfortable calling higher energy costs an "economic tax" which slows the economy the same is true for copper, steel, lumber, soybeans, eggs we live in extraordinary times, where all major central banks are encouraging bond speculation, extreme leverage, Asian subsidies of the US Economy, etc such a climate is nowhere conducive to higher rates not yet, but they are coming they are coming with a shitstorm I SHUDDER WHEN I THINK OF WHAT IS COMING STARTING ABOUT LATE SUMMER/AUTUMN 2004 ENDING ABOUT 2007-2008 / jim