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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 (9579)	3/6/2004 1:52:35 PM
From: russwinter	Respond to of 110194

<Employment has fallen off a cliff 100% guaranteed.> Wages and salaries reported to the Treasury for tax withholding rose 1.07% in Feb.. Don't get me wrong, I'm not saying we have a strong job market, but it's not in aggregate "falling off a cliff". And even if jobs by another definition were extremely weak, the driver of inflation on the demand side is credit creation, much more so than jobs. Extremely low interest rates have encouraged Americans to expand household mortgage and consumer credit by $1,424 trillion between Nov. 2001 (offically the end of the recession) and YE 2003. During the same period, wages and salaries rose $193 billion. Household debt expanded relative to wages by 7.4 to 1. So it's like comparing a tiger to a wildcat. I'm keying on the tiger (credit creation). No let up whatsoever in January either. Message 19883972 Inflation fueling credit creation is out of control right now, and low rates spurred by BOJ interventions fuels even more of it. It obvious that the Train Wreck rather than CB policy change, or the consumer "just rolling over", will bring about the bust.