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Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: Perspective who wrote (124770)	10/5/2005 6:57:22 PM
From: ild	Respond to of 209892

Good post

To: Perspective who wrote (124770)	10/5/2005 7:51:30 PM
From: skinowski	Read Replies (1) \| Respond to of 209892

AG and Co went on to "paper over" the '2000 decline because they think they COULD. And they succeeded to an extent. A threatening deflationary contraction was averted. However, to my (at least formally) economically uneducated eye, it appears that their success was superficial and temporary. Freshly created liquidity ended up causing a real estate situation which is unsustainable... and triggered an unprecedented amount of borrowing - on all levels. Right now, the Fed's theories instruct them to worry about inflation... but, inflation - without any pressure on wages to increase accordingly - will merely reduce consumption -- and lead to a contraction... and an evaporation of liquidity. It appears that people were NEVER rational when it comes to investing -- witness the endless succession of booms and crashes throughout history.