Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: mishedlo who wrote (35051)	6/30/2005 1:40:11 AM
From: Nikole Wollerstein	Read Replies (1) \| Respond to of 110194

"he was bailing out banks not consumers" He was bailing both banks and consumers. Have you ever heard: refinance your credit card debt at 0% for 12-18 month?

To: mishedlo who wrote (35051)	6/30/2005 8:24:55 AM
From: sciAticA errAticA	Respond to of 110194

re: 1) explain Japan To suggest that the US, at present, and Japan, 10 years ago, share a similar situation and status... That they share a similar savings rate... that present US personal savings now covers US government defect spending - just as record high Japanese personal savings more than covered Japanese government defect spending and currency creation then... That the US collective "pool of savings" now is similar in strength to record saving Japan's then - in spite of US consumers spending it down at a ravenous pace, courtesy of Asian vendor finance and wholesale credit... That that bubble in ponzi credit creation in Japan then was the same as it is in the US now... That the US now and Japan then share similar collective defecits (all 3) and debts... That the yen then and the dollar are now in a similar state... Is... surreal... ... and there's really no need to get violent... <g>

To: mishedlo who wrote (35051)	6/30/2005 11:36:35 AM
From: J_Locke	Read Replies (2) \| Respond to of 110194

The hyperinflation scenario is pretty simple. The government starts issuing $5,000 tax "rebate" checks to every American, while the fed monetizes a like amount of debt on the back end. This won't happen until the country has been in recession for a year or two, but it will happen. The collapse of the housing bubble will put severe stress on the banking system, and the fed will be more than willing to engage in unconventional measures to combat deflation.

To: mishedlo who wrote (35051)	6/30/2005 1:26:09 PM
From: benwood	Read Replies (1) \| Respond to of 110194

I think the endgame will be deflation with inflationary headwinds (the printing presses and the shrinking pool of professions in high labor demand, some commodities for a while, perhaps ballooning socialism). The game will be reversed from a few years ago when it was inflation with deflationary headwinds. I believe the headwinds will mitigate any abrupt drop, but I don't see any other outcome except a very very slim chance of a hyperinflation which ruins our economy for years (precipitated by banker suicide or a major nuke attack). Could be that some serious hedge fund unravelling will produce a shock that goes well beyond what anybody can comprehend, esp. considering how many countries are co-dependent in their currency inflation, commodity crack-up usage, and supplying the debt-riddled US-consumer junkie. I believe that fewer and fewer professions will have wages that keep up with inflation. Some of the trend-breaking will be very painful -- civil service for example, where gov'ts will be under great pressure to run their own debts. Difficulty in changing constitutions or whatever will probably result in some nasty business all over the place. I don't expect it to be easy to forecast anything except the decline of the American Empire with Iraq (and the expenditures and the eventual blowback, perhaps very violent) being a catalyst with our policy being set by fanatical Christian zealots and two-year old playground bullies. This process will disproportionately affect the middle class. Frankly, the top 1% could have a 80% reduction in net worth and only be back to the 1990 time frame in wealth. yawn That's my two cents. To me, it's a horrible investment environment, since selling my home and/or moving to ??? isn't particularly appealing to me. Mostly I push a few buttons on PM pullbacks and hope something comes of that, but seeing how there's really no precedent in history for the kind of real estate, public and private debt and imbalances, and derivative bubbles we've been blessed with, the behavior of everything in the outcome is rather a fog to me.