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

To: CalculatedRisk who wrote (58489)	4/17/2006 5:20:46 PM
From: bond_bubble	Respond to of 110194

CR, You have mentioned the Roubini article and said it is demand shock this time rather than supply shock. All I'm saying is there is lot of speculative element to it and hence it is not 100% demand shock (I dont know the speculative %age). One classic example of speculation: The market speculates Iranians or Chads or Nigerians are going to block oil flow - so better buy now mentality!! So oil prices are high!! I agree with you that the economic impact is going to be a recession and my bet is that deflationary recession in asset (bond, stock, house etc prices fall) and inflationary recession in commodity market. i.e inspite of humongous credit deflation, we are going to have some inflation in the consumer prices (not a hyperinflation). without even Ben revving that helicopter, there is going to be high inflation in the PPI - hence companies going extinct. After couple of years, even commodity market will have to succumb to deflation ....

To: CalculatedRisk who wrote (58489)	4/17/2006 5:34:12 PM
From: benwood	Read Replies (3) \| Respond to of 110194

The Seattle Times reported on Sunday that the housing bubble has finally started to spill over into the rental market: seattletimes.nwsource.com In short, in the past 12 months, the following has been observed: * vacancies dropped from 6.5% to 4.6% * rents up 4%, with 3 of 4 apt. managers saying they plan to raise rents within 6 months * move in incentives dropped from 64% of properties to 26% of properties Beyond higher mortgage/house purchase costs, declining inventory (conversions to condos) and strong local job market contribute to the increased rental demand.