Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: John Vosilla who wrote (69355)	9/5/2006 4:16:14 PM
From: Mike Johnston	Read Replies (1) \| Respond to of 110194

"if in 18-24 months the fed funds get cut back under 2% and the 10 yr goes even lower than today then deflationist theorists will be proven right." I disagree. Deflationists will be proven right if oil drops to $40, gold returns below $400, real estate drops 50% or more and dollar returns to parity with euro. Fed funds could be at 2% or even 1% then, but fed funds alone are not a determinant. I could easily envision funds going down to 2% and 10 year at 3% to put a floor under the housing market while gold explodes north of $1000, the dollar declines significantly and inflation goes through the roof.