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

To: $Mogul who wrote (83906)	7/19/2007 3:42:58 PM
From: Mike Johnston	Read Replies (2) \| Respond to of 110194

If long rates go up, the Fed might be tempted to use unconventional methods and start bond market monetization to artificially lower long rates. If that happens hyperinflation is a certainty and God bless those who have bonds, cash or do not own gold.

To: $Mogul who wrote (83906)	7/19/2007 9:15:42 PM
From: John Vosilla	Respond to of 110194

'Massive inflation is coming. The stock market has been telling us this for a year now.' A little dollar debasing with very low long term rates help<g>

To: $Mogul who wrote (83906)	7/20/2007 6:18:25 AM
From: Real Man	Read Replies (1) \| Respond to of 110194

We'll see. It seems to me most if not all of this inflation is coming from the credit bubble. The Fed is printing, sure, but what's a billion dollars for US markets? Nothing. It gets leveraged immediately, with a huge multiplier. Can this continue forever, or the debts will have to get paid some time? I don't know the answer, but it seems to me Russ is right, inflation bet has been overleveraged and overplayed over the recent years, and both the bulls and the bears are long the idea, just different parts of it - bulls are long stocks, bears are long gold and gold stocks. So, dollar can't rally, stocks can't decline, debt can't blow up vaporizing piles of liquidity. Right? Seems to me vaporization process is going on, but it did not catch up yet with the broader market. No idea what to do, but perhaps being "out" of all this could prove to be a good thing.