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

To: Ken Reidy who wrote (64504)	6/24/2006 12:37:54 PM
From: John Vosilla	Read Replies (1) \| Respond to of 110194

'My vote is the Fed and the Goldman Sachs Government don't have the guts to take us down the deflation path to purge this excess credit...hence they will inflate vigorously as soon as possible and walk us down the hyperinflation path until some future date where we get the deflationary collapse and massive debt defaults.....' They must attempt to muddle through. High inflation results n much higher long term rates a killer for housing and many discretionary parts of the economy. Muddle through with reflation, a steep yield curve and continuing to understate CPI and keep long term bond yields artificially lower than should normally be. I bet a fed funds at 3% and 10 yr at 6% looking out 12-18 months would be a logical balancing act.