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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 (32217)	5/12/2005 10:52:27 AM
From: ild	Read Replies (1) \| Respond to of 110194

Date: Thu May 12 2005 09:25 trotsky (Wal-Mart warns) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved somewhat contrary to the government's release of 'better retail sales' ( as usual, we can be sure the devil will be in the details ) , Wal-Mart both misses and warns. as the nations premier retailer, it is probably the best representative of actual mass market consumer demand trends. as i keep saying, the downturn in progress will be different from the last one, which was primarily a business - led recession. this time, the consumer is going to lead. this is actually not a bad thing, per se. households are in urgent need of balance sheet repair in order to create the condition that is known as 'pent-up demand', which is a necessary sine-qua-non for a self-sustaining economic expansion ( i.e., one that does NOT depend on massive monetary and fiscal stimulus and the associated perpetuation of malinvestment ) . that said, we can be sure that A ) the authorities will do whatever they can to arrest the downturn as soon as it becomes more obvious ( i.e., they will commit yet another grave policy mistake ) and B ) the business side of the economy is likewise set to turn down, as recent trends in the ROC of capital spending show. as to the effect this will have on gold and commodities, one would normally expect gold to begin a phase of relative outperformance versus the CRB.