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

To: orkrious who wrote (26324)	2/11/2005 7:26:09 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

It (and the reflation trade) will need the foreign custodials to survive. jessel.100megsfree3.com Plus I'm not sure the lone Fed reflation or easy money effort kicks in until more damage has been caused to the stock market. I do think they raise rates again in March, then look for it. They may go pretty tough in the meantime for several more weeks. I wouldn't expect the Fed to just announce no rate increase next Monday, after a big "bull trap" rally. In fact maybe the opposite, as they like to get mileage out of bluster. It will evolve in a more tricky fashion, when they have an excuse for it (like some news Bully loves, or a minor (or major?) semi-hidden crisis). If it's just the Fed by themselves monetizing and printing money to purchase overpriced US debt, this could turn into a nasty USD rout in a big hurry. Right now they've stabilize things a bit by getting the hedge funds to liquidate USD, gold and other real assets and goods, and get neutral. Yesterday's big CRB rally (and today's decent follow through) and USD drop must signal to them the need to tread lightly, or the cat will be out of the bag again real quickly. Therefore it may evolve a little slower. If there was a USD swoon now, it will put more and more pressure for some central banks to offload on the Japanese and Chinese, or maybe just the Japanese. The Japanese and US central banks can no longer monetize one trillion bucks of Old Maid card debt a year on their own, they need other patsies. So it will be a dynamic situation, not cut in stone.