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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 (61482)5/19/2006 5:50:57 PM
From: patron_anejo_por_favor  Read Replies (3) | Respond to of 110194
 
>>Feedback loops are scary in economics. Any or all of these could make a bad situation much worse.<<

Yes...the only way to avoid them was to not let the housing bubble get started in the first place. "The only way to win is not to play....."<G/NG> This is what happens when markets are not allowed to clear. Recessions are a necessary part of economics, but the cowards in charge of the Fed and the government have no stomach for them (since Volker left, anyways....)



To: CalculatedRisk who wrote (61482)5/19/2006 11:20:51 PM
From: John Vosilla  Respond to of 110194
 
"Feedback loops are scary in economics."

Going to be even scarier this summer when you add feedback loops into the global warming/hurricane equation..

Maybe we actually get fed lowering rates a bit if GDP goes negative the last half of this year and natural disasters occur causing a fairly steep yield curve with the 10 yr rising a nice chunk from here.