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

To: mishedlo who wrote (24104)	2/22/2005 3:03:45 PM
From: Tommaso	Read Replies (4) \| Respond to of 116555

I think there will be major price drops in the housing market. I think there will be major drops in the prices of SUVs, especially used ones. I think there will be major price drops in most luxury goods. I think the American standard of living will contract. But because of the decline of the dollar, and because of increasing demand from other countries, I do not think that there will be price declines for necessary and useful commodities. Right now, a person in Europe who drives a 50 mpg small diesel and who pays a euro per liter for diesel fuel hardly feels any pinch from rising fuel prices. Americans will feel extremely pinched if they have to pay over $100 to fill up the tank of their SUVs. I do not expect a general deflation of all prices to rescue them from their discomfort even if they cut back on their driving. I do not expect food prices to drop, as they did in the Great Depression. I expect American agricultural exports to increase and food prices to remain firm and rise somewhat. I do not expect to see people hoarding cash.