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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 (49548)	1/12/2006 11:38:36 AM
From: ild	Read Replies (1) \| Respond to of 110194

Date: Thu Jan 12 2006 11:26 trotsky (in addition) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved to the trade deficit, we have a host of other indications that the 'indefatigable' US consumer is finally caving in to the effect of years of falling real wages and taking on more debt that he can possibly afford. among the more obvious, two months of negative consumer credit growth, and surprising builds in gas and distillate inventories. also, mortgage refinancing has fallen off a cliff, and inventories of residential real estate for sale have exploded ( mostly due to falling demand, imo ) . the air is definitely getting thinner for the US credit bubble economy. Date: Thu Jan 12 2006 11:21 trotsky (@falling trade deficit) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved a fall in the trade deficit is extremely bearish news for the stock market and the economy. i know this view goes against conventional wisdom, but not if you really think about it. after all, a rising deficit denotes rising consumer demand, and a falling deficit does the opposite. it means that the 'social mood' to use a Prechter term, is turning from bull to bear. of course one month worth of data is not really a meaningful indication yet that this is actually what's happening. however, if the deficit were to continue to decline, it would be a good idea to short the broader stock market.