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

To: Jim McMannis who wrote (95853)	7/25/2008 3:52:00 PM
From: John Vosilla	Respond to of 110194

'After 4.5 years the deflation thread is still waiting for their moment in the sun.' Meanwhile we are back to 2003 in many ways with housing prices falling incredible percentages deemed impossible only 2 years ago. Really at this point it is all about stagflation, interest rates and oil prices. Deflation fear mongering the biggest con of all actually helps keep long term rates low and gives a better chance for recovery sooner than people think.. Who knows quite possible we get a double stock bottom later this year and run like off the March 2003 lows if inflation gets contained here.. You know low expectations, a crash in the stock market, a recession well underway and low inflation are the best recipes for the next bull market. I have my doubts it can happen this time but if it doesn't it is certainly not because of deflation or the credit crisis<g>.. Gauge of future US economy near a 5-year low: ECRI NEW YORK (Reuters) - A gauge of future U.S. economic growth fell to its lowest level in nearly five years and its annualized growth rate was also down, indicating that an upturn in the business cycle is not yet in sight, a research group said on Friday. The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index fell to 129.4 in the week to July 18 from 131.1 in the previous period, downwardly revised from 131.2. The decline in the index --to its lowest since it hit 129.0 in the week to October 24, 2003-- was due to higher interest rates and jobless claims and to weaker housing, Lakshman Achuthan, managing director at ECRI said in an instant message interview. The index's annualized growth rate slipped to a 10-week low at negative 6.9 percent from minus 6.5 percent, revised down from minus 6.4 percent. "The way a good leading index works is that its level always turns up months before the end of the recession," Achuthan said. "With the WLI level falling to its lowest reading in nearly five years, it is clear that a business cycle recovery is nowhere in sight." reuters.com