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

To: shades who wrote (62515)	6/2/2006 9:50:47 AM
From: John Vosilla	Read Replies (1) \| Respond to of 110194

"..take all that new gubbment bernanke helicopter money and build up reserves like the banks did in Hoover's day - why won't the result be the same - they can print and print - but people won't take on new debt and banks won't extend new credit - did you think of that?" We are going to need a very serious downturn for most America's and financial institutions to start thinking that way again. Probably a good thing longer term if they met in the middle. Perhaps the mid 90's rather than the mid 30's?

To: shades who wrote (62515)	6/2/2006 10:53:49 AM
From: GST	Read Replies (1) \| Respond to of 110194

<college friends> US unemployment is low. College grads are by all reports doing fine. Perhaps the problem lies with your friends or your location?

To: shades who wrote (62515)	6/3/2006 1:50:42 AM
From: bond_bubble	Read Replies (1) \| Respond to of 110194

Well then they would have to come up with 500 dollars or so eh? And show up to the lawyers office and fill out paperwork - they always tell me hard work pays off later - but laziness pays off now - too lazy to file bankruptcy. Shades, how come you are assuming that, people dont have $500 to pay for filing bankruptcy, but have enough money to pay for the debt with devalued currency? Also, you are assuming, people are lazy to file bankruptcy but are energetic to pay the debt with interest. You have to be more serious than that. BTW, not filing bankruptcy and not paying debt/interest is ALSO bankruptcy (may be "unofficial" bankruptcy). Also, you and Chromatic keep making the assumption that Ben will fly with his helicopter money. And I've told you many times, by deflation, I mean credit deflation and not CPI becoming negative. Now, if CPI is positive, will Ben still fly his helicopter money? What if $ devaluation ALONE creates inflation inspite of credit bust? i.e $ devalues 30% and credit falls 20%, it is credit deflation (20%) and yet, price inflation will be positive. In this scenario, why would Ben bring his helicopter. If you dont believe in this scenario, then you will never understand deflation. Herb and Maudlin is saying people are taking less debt huh? How can that NOT mean deflation? It is the classic argument for deflation!!! People dont take loans from banks to load up debt - this is exactly what causes deflation. I'm not sure how people can see this as prelude to hyperinflation. According to Minsky, if people stop taking less debt, it implies that the ponzi scheme will come unravelling. For hyper inflation to happen, people should take more and more debt. That is the ONLY reason why people say, hyperinflation ends in deflation. Even puplava says, it is hyperinflation first and then deflation. i.e at some point in hyperinflation, debt stops flowing. And hence results in deflation.