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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: pogohere who wrote (76575)	3/20/2008 6:30:15 PM
From: Real Man	Read Replies (1) \| Respond to of 116555

1) It's a SOMA drain, but it neutralizes the effect of new TAF, so it is not what it seems. 2) TAF is very secretive, gives cash to some crooks, denies cash others. Thus, a perfect "goldilocks" moment - stocks rally, bonds rally, dollar rallies, commodities drop. 3) So, 60% of SOMA gone. What is next? path choice: 1) Deflationary ka-boom (dollar will drop quite a bit!) 2) Get some more securities from the treasury or via the coupon passes - monetize bad debt (dollar drop to zero.) We'll see as we go. Which path will be chosen? Hmm... Was the Fed THAT concerned about the falling USD and its effect on inflation? Not at the moment. This may change... or not.