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

To: John Vosilla who wrote (76641)	12/26/2006 1:17:32 PM
From: Mike Johnston	Read Replies (2) \| Respond to of 110194

I think where Mish went wrong with his analysis is that he has underestimated the willingness of central banks to create as much fiat currency as they did AND the public's ignorance in being fooled by the fraudulent CPI/money supply statistics. I don't blame him. I have made the same mistake and it cost me quite a bit. And this is all childs play in comparison with the amount of currency that could be created if the Fed uses unconventional methods, in the latter case new money can be created not only by creating new credit but also through elimination of credit (fed purchasing notes with new money and then shredding those notes) And this is where the "deflation story" dies.

To: John Vosilla who wrote (76641)	12/26/2006 1:39:05 PM
From: Mike Johnston	Read Replies (1) \| Respond to of 110194

There are only two scenarios where the dollar does not collapse and very high /hyperinflation is avoided: 1) reckless monetary policy and dependence on asset bubbles and inflation for economic growth is reversed in this country. 2) Foreign countries engage in the same reckless monetary and economic policies, in that case all currencies will in the end collapse against real assets and the whole world economy will collapse in the fire of hyperinflation.