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

To: GST who wrote (65490)	7/7/2006 11:40:14 AM
From: UncleBigs	Read Replies (2) \| Respond to of 110194

I don't think you grasp how a savings rate that has nowhere to go but higher and a debt to gdp ratio that has nowhere to go but lower affects asset prices. We're about to see liquidity dry up.

To: GST who wrote (65490)	7/7/2006 11:41:18 AM
From: John Vosilla	Read Replies (1) \| Respond to of 110194

I wrestle with that one constantly given how high interest rates would also have to go and what that does to tangible asset values.. Still expecting blending of the 1970's for the real economy and non bubble RE but the early 90's debt cleansing RTC period for bubble RE. Can United States financial institutions remain strong, liquid and willing to lend in this environment? Inverted or flat yield curve for a long time is bad for financials. I bet quietly Bernake and company hope for a very slow steady up move in long term rates to get out of the mess.