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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (113525)	3/30/2008 12:59:09 PM
From: neolib	Read Replies (1) \| Respond to of 306849

I certainly have no desire to see the government extend it's deficit spending, but there seems to be tremendous demand for treasuries over private market bonds. Gee, why would that be? And if deficit spending is required to ramp up in order to provide the supply to meet this demand (as well as maintain employment levels), I hope the majority of it is "invested" in areas that will eventually create economic benefits. The Government digging deeper debt holes is fundamentally no different than it's citizens digging deeper debt holes to bolster the economy. At some point it becomes obvious that the debtor is in trouble, and the entire little Ponzi scheme tumbles down. Not to long ago, many pundits found all sorts of reasons why real estate was entering a golden era, and we really didn't need to be concerned about the debt and quality of same as housing blossomed. Gee, there was even robust demand for all the MBS & CDOs output from that process. Surely that is an argument for perpetuating the scheme? No different than the demand for Treasuries. Everyone with money to invest chases investments. But that does not mean any of the investments are sans risk, or that those taking on the debt will not default. If wishes were horse then beggars might ride. Demand for investments is no justification for any private or public organization going into further debt to provide the product.