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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 (26045)	2/8/2005 1:36:10 PM
From: ild	Respond to of 110194

Date: Tue Feb 08 2005 12:04 trotsky (Earl Grey) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved " I don't believe that they have hedged away this problem." if you think about it, system-wide, NOTHING can be 'hedged away'. derivatives are a zero sum game - what one party to a contract gains, another loses. the only question worth asking in this game is 'will the losing counterparties be able to pay up'. Date: Tue Feb 08 2005 11:58 trotsky (Hambone@long in the tooth) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved it sure is. and even if it is fated to last a little longer ( the mid 70's equivalent lasted 18 months ) , it is high time for a bounce anyway. my only caveat w.r.t. the Rand is that the dollar could embark on another down leg against all currencies once an end to the Fed's rate hike campaign comes into view. but for now, the SARB is likely to ease, while the FOMC will likely give us one or two more hikes, so the rate differentials are for the moment not moving in the Rand's favor either. Date: Tue Feb 08 2005 11:48 trotsky (Bleuler) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved "Their wealth is unprecedented in this country's history as well as anyone else. Their assets are their home and their pension or IRA plans." too true. this is also known as 'phantom wealth'. it only exists as long as the credit bubble underpinning the 'value' of these assets persists. but alas, things that aren't sustainable won't be sustained.