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

To: russwinter who wrote (76498)	12/24/2006 7:14:29 AM
From: Real Man	Read Replies (1) \| Respond to of 110194

Russ, I agree fully with all your blogs on what's transpiring in our economy and society (I read them all). What's next is the question. You have a strong opinion that Riskloves trades will collapse. Could be, but it's hard to see the crisis of this type approaching, when spreads and VIX are at or close to all-time lows. The "pinned" look of the stock market continues, with only a mild decline from the highs, and the sharp 20-point SP rally (in 1 hr.) may be coming next. The problem is that Riskloves and Pig Men are an interconnected group - Pig men own many Risklove funds, and are counterparties with Riskloves in derivative trades. I'm not sure they are interested in sinking all Riskloves. Bart13 offers some charts on what happened in Germany during hyperinflation incident. I think that's something for us to learn. Message 23127482 Brazilification would continue should a hyperinflation hit, with wealth transfer from BA and the real economy to Pig men and Riskloves reaching its climax during hyperinflation. The real economy then will be completely ruined. Personally, I really hope you are right, and the collapse of Risklove trades is coming. That would reverse the trend of destruction of the real economy that we are in now. I think our path will depend on the actions of the Fed. So far I just don't see them as being responsible enough to stop the destruction. Maybe, they will become responsible if the dollar starts dropping fast. For me, given the Fed action so far, it's not "if" but "when". CBs in other countries - Europe, Australia, etc. seem infinitely more responsible now than the Fed. Not the Japanese. They will likely raise rates, putting a pressure on the dollar.