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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 (12179)	4/19/2004 12:35:00 PM
From: russwinter	Respond to of 110194

<far away from another refi boom now.> We don't need no stinkin' refis! Seriously I do feel there are some stress points in the borrowing daisy chain, but still it's pretty tenacious. Borrowers just switch to even more dangerous leverage: HELOCs, one year ARMs, and credit cards to pay their F3IP induced higher bills. Message 20034407 This is the classic Kindleberger theory (), whereby consumers refuse to act rationally to downsize their standard of living. They will take the easy way out if given to them: borrow more in this case. () I wish I could recall his term for it, damn getting a bit senile. I think it's "overloading"? Source is his 1979 book about Panics and Manias.

To: mishedlo who wrote (12179)	4/19/2004 12:40:36 PM
From: Wyätt Gwyön	Read Replies (2) \| Respond to of 110194

We are far far away from another refi boom now. aren't you predicting a bond rally (MR. Market has "raised" rates only to see them lowered within months every time)? if a bond rally happens then refis will happen. actually we may have a good setup for a rally, although i am not betting on it. there is that big short position in TLT, and the monster yield move we've had the past month based on specious job figures. so if it takes that little to bump yields, what happens if we print another low jobs figure? somewhere over the weekend i read somebody predicting the "biggest rally ever" or somesuch if we print 75K. refi boom over yesterday. I agree (and said so myself last week). then why are you expecting a bond rally? they go hand in hand, don't you think?