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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (5751)	5/6/2004 4:03:44 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Hienz on trade deficits and rate hikes trotsky (frustrated@trade deficit) ID#377387: Copyright © 2002 trotsky/Kitco Inc. All rights reserved one thing that is overlooked is that the trade deficit is actually a COST for domestic producers. it is an unhealthy imbalance precisely because it signifies that more is consumed than produced in the US. note: it would not have burgeoned to the extent it has under a gold standard - a corrective move would have set in much earlier, and would have been mild compared to the catastrophe we're going to get instead. Date: Thu May 06 2004 13:45 trotsky (frustrated, 13:08) ID#377387: Copyright © 2002 trotsky/Kitco Inc. All rights reserved Greenspan neglected to mention what actually HAPPENS when "market forces correct excessive consumer debt, a low savings rate and a huge trade deficit". care to guess HOW such imbalances tend to be corrected? there's only one way: a huge economic bust. this also why i tend to dismiss the 'rate hike threat'...it would be akin to the temporary rate hike of 1931, which got reversed almost immediately once it became clear that the economy's implosion gathered steam in its wake. Date: Thu May 06 2004 13:01 trotsky (Homestake@oil) ID#377387: Copyright © 2002 trotsky/Kitco Inc. All rights reserved if you look closely at my post, i have only cited the KNOWN FACTS. i have NOT mentioned any 'analyst projections'. imo even the most pessimistic such forecasts are probably too optimistic - they haven't incorporated the fact that global demand is simply exploding, i.e. rising much faster than anyone has anticipated. this is not to say that the $40 resistance level WON'T reject the WTI futures price this time around - it is more likely that it will. however, once this ages old resistance level falls for good, i will take it as more proof that the oil supply situation is already far worse than officially believed. as for analysts, note that MOST analysts do not even know anything about the the depletion situation, certainly not on WS. or if they do know, they aren't telling. oil depletion remains something that is only discussed by a minority.