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: Tommaso who wrote (79953)	3/13/2007 11:12:48 AM
From: Jim McMannis	Respond to of 110194

Tommaso, RE:"I am sure you have read how there are new "homeowners" who have failed to make the first payment due on their mortgages." In what period of time? Got a link on that one?

To: Tommaso who wrote (79953)	3/13/2007 11:21:18 AM
From: Real Man	Read Replies (1) \| Respond to of 110194

Yep. I forgot the term for those mortgages. Rates are resetting, and credit conditions in the mortgage market are tightening, so I expect a large derivative blow-up very soon. The stock market is just waking up to all these problems. The mortgage market has been the main force behind the post-911 recovery. So, it sure looks like it's over now. On top of that, as the credit crunch cascades through the system, they have no more bullets left - the budget deficit is already extremely high, so they can't do more tax cuts and increase government spending. If they cut rates more, the carry trade will blow up. Looks like checkmate for the Fed. One thing is sure - they will try to print to save the system. So, if gold does go down due to decreased liquidity, it's a buying opportunity.