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

To: Mike Johnston who wrote (62040)	5/26/2006 10:01:17 AM
From: russwinter	Respond to of 110194

Two tiered rate structure and targeted liquidity !> "The truth is that liquidity, the only significant weapon remaining in the central bank's arsenal as decision making moves to the markets, will not necessarily go where you want it to go when you need it to go there." --Martin Meyer writes in The Fed ‘Ponzi’ finance units must increase its outstanding debt in order to meet its financial obligations.” A transition occurs over the course of an expansion as increasingly risky positions are validated by the booming economy that renders the built in margins of error superfluous - encouraging adoption of riskier positions. Eventually, either financing costs rise or income comes in below expectations, leading to defaults on payment commitments. --Hyman Minsky