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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 (74897)	12/6/2006 11:39:27 AM
From: mishedlo	Respond to of 110194

Mish, i don't buy your argument that money growth is close to zero, even you admit that the world is awash in dollars. To me awash is an understatement. If money growth is in low single digits, where is that flood of dollars coming from ? My argument is a statement of fact not subjection. economagic.com Money supply has been essentially flat for a year. CPI adjusted money supply is negative. Bear in mind that M1 is understated by sweeps and I will have a chart out on that soon, but actual money has not been growing. I make a huge distinction between money and credit and credit has gone thru the roof. Yes, credit has gone nuts and it will go more nuts if this leveraged buyout mania continues. But for all of that that is currently happening where are prices? Certainly nothing approaching hyperinflation. Also note that it is not just the US. Credit has been soaring in the UK and EU as well. This is malinvestment and will be wiped out. The result is deflation. Mish