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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 (18968)	9/23/2004 3:59:18 PM
From: russwinter	Respond to of 110194

If so, I'd ask if the tail wags the dog? I think the reverse. BTW, I don't think Saville (or I ) argues that consumer debt will never shrink, only that the forces at loose (nearly free money, and slack underwriting standards) in the world, strongly encourage excessive borrowing. I don't see consumers making rational choices about borrowing at all, it's the Kindleberger "loading theory" (will refuse to rationally give up standard of living), that I've covered several times here. Today's bond action, 2/10 year spread narrows 3 more bps to 152. The agency spreads (over treasuries) widened by 2-3 bps. Maybe a tad of effect from the FNM fiasco, bears watching? gcm.com