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

To: mishedlo who wrote (50623)	1/21/2006 4:33:06 PM
From: benwood	Respond to of 110194

Congrats! I subscribe to those but hadn't read yours yet. --Ben

To: mishedlo who wrote (50623)	1/22/2006 8:51:27 AM
From: Tommaso	Read Replies (1) \| Respond to of 110194

>>>any significant continued inflationary scenario either.<<< It has already happened. Houses, college tuition, the price of milk, medical costs, and innumerable small ways. Gasoline is up 300% from a few years ago. The bran muffin I buy at the farmers' market recently went up 25%. The salad I used to buy at the supermarket went up 35% recently. Gold is up over 50% in a year. Motel rooms that went for $60 three years ago are $90. Beer is more likely to be $3.00 or more at a restaurant instead of $2.50. The government measures of CPI are not accurate, not even including house costs and instead using rents, which have been held down as more renters bought houses.

To: mishedlo who wrote (50623)	1/23/2006 10:31:40 AM
From: GST	Read Replies (1) \| Respond to of 110194

<Does GST have a timeframe for his inflationary dollar death scenario?> GST has one main point -- your deflation logic has gaps big enough to drive a Mac truck through it. The dollar is increasingly vulnerable year after year and for long term investors (as distinct from knee-jerk speculators concerned more with the next 24 hours) the dollar is something about which we should have major concern. A fall in the dollar will be inflationary. A slowdown in the US economy whether from higher oil prices or the collapse of housing or concerns about US inflation would all be candidates for pulling the rug out from under the dollar. The long term probability for the dollar to fall is very high -- baked directly into the current account deficit. No country can debase its currency and expect to be rewarded with increased purchasing power (i.e. deflation). Deflation is the lowest probability outcome. Stagflation is a high probability outcome. Long term healthy growth with low inflation would require major changes in our economic direction -- but it is not impossible. It would however require leaps of faith about our ability to address major economic and political issues -- I doubt we have the collective stomach for it.