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

To: koan who wrote (77895)4/17/2008 7:46:04 PM
From: Elroy Jetson  Read Replies (2) | Respond to of 116555
 
I suppose you'll be first in line to lend your savings out long-term to home buyers at 3% when inflation is 12%? 17%?

It will never happen.

You're going to get your brutal recession, don't worry about that.
.



To: koan who wrote (77895)4/17/2008 11:51:36 PM
From: mishedlo  Read Replies (4) | Respond to of 116555
 
Current high PPI inflation levels will likely lead to high inflation rates - and if it does this will produce very high interest rates, and even lower home prices.

Nonsense
Price can not rise above peoples ability to pay for them, at least for long.

That is why housing is crashing now.

If wages do not go up, prices of housing will continue to drop regardless of what the cost of materials is.

Simple economics.

Mish



To: koan who wrote (77895)4/18/2008 7:03:05 AM
From: Dan3  Read Replies (1) | Respond to of 116555
 
Re: I posted exactly what you just said. That inflation will soon cause interest rates to rise and could push a recession into a depressions. No one seems to understand exactly why interest rates continue to stay low as long as they have.

The Fed is actively intervening to reduce certain headline rates. It's like suppressing a fever with injected steroids.

The final result of Republican style supply-side economics is hyperinflation.


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