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

To: sciAticA errAticA who wrote (54456)	2/22/2006 8:35:06 AM
From: GST	Read Replies (1) \| Respond to of 110194

<A new macro is needed that replaces antiquated closed models with the open models of globalization> On this first point he is correct IMO. As to the second point: "wow, look at that, explosive 'growth' and no inflation!", I think he is out to lunch. I would liken this to a man who has a gun with 5 empty chambers and one with a bullet. After pulling the trigger five times while pointing at his own head he concludes, "wow, I guess this is a pretty safe thing to do afterall", and pulls the trigger once more.

To: sciAticA errAticA who wrote (54456)	2/22/2006 8:55:36 AM
From: Mike Johnston	Read Replies (1) \| Respond to of 110194

They have to keep repeating the lie in order to defend the dollar with as little rise in interest rates as possible. What would the housing and the stock market look like if bond yields were 3 points higher ? Not pretty. The current system of artificially low rates, dollar recycling and ability of the US to run budget and trade deficits can only continue as long as the public and market participants believe that inflation is low.

To: sciAticA errAticA who wrote (54456)	2/22/2006 10:20:15 AM
From: GraceZ	Read Replies (2) \| Respond to of 110194

Gold in $ terms is at a 25 year high. Oil and Natural Gas, although having eased down from record levels still trade at many multiples of their old 1983-1999 averages. Other commodities from steel to coal to copper are also far above what used to be considered normal prices. Yet, the "low inflation" propaganda holds sway. Why, why, why do people use commodity prices in order to support an argument that inflation is higher than the official view? Almost none of these people would have argued we had zero or negative inflation during the 20 year bear market in commodity prices yet they want to use them now that they are in a bull. The reason commodities are rising has a lot to do with the fact that the 20 year bear destroyed capital investment in the sector.