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

To: gregor_us who wrote (12533)	4/24/2004 8:14:32 PM
From: ild	Read Replies (2) \| Respond to of 110194

LP, my problem with Russell's idea is that I don't see what debts will be paid off. Most of out secured debt is in mortgages. Do you think many people that will accelerate their mortgage payments especially on upside down mortgages? I don't think so. What I see is massive debt repudiation. Lately I'm trying to avoid using terms "inflation" and "deflation". There are just too many meanings and definitions. To inflate debts away we need raising wages (inflation in wages). Lately it has been non existent. Government cut taxes, which had some temporary effect similar to increase in wages. Fed did their portion by lowering rates. Now both are out of bullets, but the debt has grown. China/Wal-Mart/bear market in commodities have been a big factor in increased purchasing power of US consumer. It's all over now. In the future I see bad debt/asset deflation accompanied by USD going down and inflation in consumables. Nice scenario, is it? Now, where is my Prozac? -g-