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

To: kris b who wrote (53651)	2/13/2006 9:00:44 AM
From: russwinter	Read Replies (1) \| Respond to of 110194

Certainly if GDP drops by the magnitude you mention (50%=50% demand) your scenario is correct. I don't think it will be any thing like that. This is more a maladjustment and misallocation situation than anything. The global economy has a big adjustment to make that will take time and pain. One aspect of the adjustment is a large drop in the standard of living of the US, that will help cure maladjustments. <we have overproduction and speculation in everything> True about speculation, it's really developed into a crack up boom, but overstated on "overproduction". Actually we have critical almost Malthusian shortages in many areas, and too much production in others (housing, and lattes). Again, the key term is maladjusted.