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

To: austrieconomist who wrote (28440)	3/11/2005 5:29:09 PM
From: russwinter	Read Replies (3) \| Respond to of 110194

I see the risk of playing commodities today, as high and rising fast. We are in one of those rare flucht in die sachwerte periods that even the Wizards must now acknowledge. They have dangerous speculation and inflation going on in a multitude of Bubbles now, not just the favored ones of Bullies like Mr. Creosote. Therefore the Wizards are now forced to contract liquidity, and in fact the evidence (which bears close watching) to me suggests they have been for the last three and a half months. That will continue and perhaps even more aggressively at least for awhile. That will quickly bring on a big US economic slowdown, which combined with a Train Wreck Bust in China will end the spike and massive global speculation in the mega-Bubbles. It's time to bet against Bubbles, not just stay abroad them, just because this particular one (resources and commodities)has been ours. I think it (the tipping point, and sea change) unfolds over the next several weeks through next several months (sooner rather than later). This will not be benign however, because another result will be a broken supply chain from Asia, as enterprises there collapse.

To: austrieconomist who wrote (28440)	3/11/2005 6:13:17 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

When looking over the Fed H8 one can see a real sea change going on in bank deposits and consumer type lending. Since we are a bloated credit expansion based economy, there needs to be lots of too, otherwise all the malls and strips quickly empty out. Overall bank credit is misleading right now, because it seems to be funneled into speculative and real estate activity. But when you break it down, and look at overall bank deposits, they are barely growing. YTD is only up $4.25 billion a week, compared to $11 billion a week in 04. Look at combined home equity and consumer loans. Last year that ran about $3.4 billion / week. YTD it's only $1.3 billion, with consumer loans absolutely flat. There may be a little lingering juice from refis, as that been over 2000 the last six weeks, but this latest rate spike should knock that down too. I've already commented on the effect on month in month out ARMS resets now. And gasoline. For my money I just don't see how you can have an expanding Bubble based economy with this happening. Unless they can get rates back down 50 bps, the retreat is underway. federalreserve.gov