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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 (21491)	11/8/2004 2:15:34 AM
From: John Vosilla	Respond to of 110194

You must listen to hour two of Puplava this week. Many reasons besides debasing the debt as to why long term rates and inflation could go up a lot even with a serious recession looming in the next 12-18 months. The guest Frank Barbera expects savers to continue to be penalized along with bond, stock and housing market crashes. < want hyper-infaltionsists to tell me exactly what is going to support house prices in a rising interest rate environment. If housing prices fall I want someone to tell me why everyting else will keep going up. Eventually (perhaps we are not there but perhaps we are) but eventually as in SOONER rather than later at the current rate of rate hikes, housing is going to go soft. Do not tell me that monetary inflation alone will always save the day because I proved it will not always do so. Deflation in Japan set in with a housing bust and 18 years later is still going strong or perhaps perhaps JUST NOW after 18 years shoing sign of remission. That is what a major housing bust country-wide will do to you. Exactly what is going to prevent a housing bustor at least a major slowdown here? The PPT can keep stock prices up, intervention can prop up the US$, but what if anything is going to support house prices? Are we going to buy more junk from China if prices are rised 20%? 10% 5%?. Is there that much pent-up demand for computrers, TVs, and cell phones? Will rising energy prices take away from other consumer spending or not? If 1% interest rates did not create any jobs other than in housing and walmart what will? What will happen to those housing related jobs?>

To: mishedlo who wrote (21491)	11/8/2004 7:35:44 AM
From: Wyätt Gwyön	Respond to of 110194

FedEx Will Raise U.S. Rates by 4.6% online.wsj.com more signs of deflation? -g-

To: mishedlo who wrote (21491)	11/8/2004 7:40:40 AM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 110194

mish, those are some tried and true deflation arguments, but i think you are stating them outside the context of USD's going downtown. the only solution to the current imbalances is for other currencies to rise against USD, and this will definitely cause higher cost of money in the states and more expensive imports, raw materials, etc. so i would say people will be consuming less, but unit costs are going up. the only thing up in the air, as i see it, is the WHEN. who knows where the tipping point is, but i wouldn't be pressing my luck on USD with $700 billion C/A deficit looming next year as the Iraq quagmire deepens. and let's not forget all the sentimental reasons people around the world have to switch to something besides USD. basically, a worldwide boycott of US hegemony--that's what you'll have in EUR-based crude and gold-backed dinar. not to mention widespread hatred of US is causing consumers in places like Europe to boycott all and sundry US products. as for interest rates, ask yourself what Greenspan does to the policy rate at UDX 75 with the Asian LDC CBs abandoning the greenback. ironically, perhaps, it looks like high crude could force the foreign CBs' hands, eh.

To: mishedlo who wrote (21491)	11/8/2004 8:22:28 AM
From: russwinter	Respond to of 110194

U.K. October Factory Prices Rise Fastest in Almost Nine Years Nov. 8 (Bloomberg) -- The cost of goods leaving British factories rose in October at the fastest annual pace since December 1995 as the price of metals and oil jumped. Producer prices rose a nonseasonally adjusted 3.5 percent, from 3.1 percent in September, the National Statistics office in London said. On the month, prices rose a nonseasonally adjusted 0.7 percent, compared with 0.3 percent in September. ``Much of this reflects the surge in oil prices, but the boost to other prices from this rise in costs is likely to ripple through gradually in coming months and quarters,'' said Michael Saunders, an economist with Citigroup in London, in a note to clients ahead of the release. Companies in the U.K. have come under pressure from rising raw material and energy costs, although many of them have been unable to lift their own prices because of competition. This has had a limited effect on broader measures of inflation until now and has reduced the need for the Bank of England to raise interest rates. Today's figures show that inflation is beginning to feed into other areas of the economy. Pilkington Plc, the world's biggest maker of car windshields, said on Nov. 3 that energy costs limited profit. Alumasc Group Plc, a U.K. supplier of engineering components, said on Oct. 21 that rising energy costs will hurt its earnings. U.K. manufacturing is the worst performer after Italy in the Group of Seven industrialized nations since the global economic slowdown began in 2001. U.K. factory output rose 0.1 percent in September, the statistics office reported last week, and contracting overall industrial production cut growth in Europe's second-biggest economy to the slowest in 18 months during the third quarter. Raw materials and energy costs jumped a nonseasonally adjusted 8.4 percent in October from a year earlier, the fastest pace since November 2000, when they rose 9.1 percent. Raw material and energy prices were forecast to rise 7 percent in the year, according to the median forecast of 30 economists surveyed by Bloomberg last week. Factory prices were forecast to gain 3.2 percent from a year earlier. The increase in raw material costs was led by imported metals prices, which rose a nonseasonally adjusted 22.4 percent, and the cost of crude oil, which leaped 52.7 percent in the 12 months. That was the biggest jump since October 2000, when it was 58.1 percent. The so-called core measure of producer prices, which excludes food, drink, tobacco and petroleum products, rose a nonseasonally adjusted 0.5 percent in the year, after a 0.3 percent rise the month before. Crude oil in New York was up 13 cents at $48.95 a barrel on the New York Mercantile Exchange, in electronic trading at 12:12 p.m. London time on Friday. Prices have slid 12 percent since reaching $55.67 on Oct. 25, the highest in the 21 years the contract has traded in New York. Copper futures for December delivery on Nov. 4 touched $1.358, the highest since Oct. 13. The Bank of England Thursday kept its benchmark interest rate unchanged at a three-year high of 4.75 percent for the third straight month. Rates are expected to rise to 5 percent in 2005, according to the median prediction of 37 forecasters surveyed by Bloomberg.

To: mishedlo who wrote (21491)	11/8/2004 1:27:53 PM
From: JBTFD	Read Replies (3) \| Respond to of 110194

The biggest argument for me about inflation is the increase in money. They want to increase the debt ceiling by some $600 billion, which they predict will be spent by next September. That represents a little less than a 10% increase by next September. All that money has to go somewhere. And since there has not been a corresponding rise in products, the cost of the existing products will rise. The second factor is that if a time comes when people realize that money is losing value, they will spend money they have as quickly as possible on tangible assets. This to me is the sign that hyperinflation is kicking in.