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

To: glenn_a who wrote (96291)	8/15/2008 1:28:01 AM
From: TH	Read Replies (3) \| Respond to of 110194

glenn, <Mish stuck to a particular end-game perspective that colored his interpretation of "real-time" data. But as far as the ultimate end-game ... who knows, perhaps he will be correct.> I've always thought that Mish's deflation view had a very high probability of being THE end game of this massive and unsound credit expansion. My perspective is I wish to profit many times before that deflation arrives. Inflation has been and is the M.O. of our completely irresponsible Fed. That will continue until it can't. Lately there seems to be more talk of deflation now, as the deleveraging is creating some short-term impacts that might be incorrectly labeled as such. I consider this recent commodity smackdown as cover to hold rates in the US and sell this interest rate differential nonsense as a reason to buy the dollar and give the Fed breathing room. The inflation data today was probably allowed to go out hot (meaning not as adjusted as it has been for the past few YEARS) in an effort to convince the mindless wall street squirrels that it is actually meaningful/accurate and not yet reflecting the oil and everything real correction. And of course the massive deficit and debt are just ignored. They don't matter to anyone it seems. It is a bizzare and twisted situation. GT TH

To: glenn_a who wrote (96291)	8/15/2008 1:48:28 AM
From: bart13	Read Replies (1) \| Respond to of 110194

I do believe Mish even pays homage to your recent discussions (smile). Yep, saw it. Stay tuned for "something". <g> The rest of your questions aren't my area of expertise but hopefully others will jump in, and I'll take a shot anyhow. 1 - Supply-demand fundamentals for Energy and Food They certainly don't look great from here. I don't think we're looking at a large Malthusian effect though... unless somebody pushes the nuke button or H5N1 or similar gets out of control. Bad - yes, massive TEOTWAWKI - no (I hope). The 1984 type effects are the areas that most concern me. And at the risk of sounding Pollyanna-ish, the human race and the US have gone through rough times before and we're all still here. 2 - Supply-demand fundamentals for Credit I don't think its inevitable that we have massive bank failures, but its also tough to judge what you mean by massive. In the US, it would surprise me greatly if we don't see well over 500 in the US before its over. I believe it will be worse than the S&L crisis. And the large drop in silver recently surprised me greatly too... I think China will not escape, but it will look like they are due to "info control". Same with other many other countries like Russia. It's not global but way more than just US institutions are or will be insolvent. It will hit every country, no matter how good their system is. Its a globalized planet and few people will escape big effects. I'm still thinking that the inflationary solution will be tried, but its also why I'm a trader and not a long term buy & hold person. Its my way of doing CYA. There are too many possibilities for me to answer the general "glut of Treasuries" etc. points - I just plain don't have a strong enough opinion to voice. The ones you named are certainly possible. 3 - Consumer Prices Probably the best & simplest answer I have is that we're following the track of the '70s but in a much more volatile way. And we will see a "return to the basics" broad based movement too - good opportunities there. I don't see a "collapse the game" scenario since its not at all in the vested interests of the elite and PTBs, etc.... but as you said about deflation, I'm not wedded to any particular scenario and will play it as it comes the best I know how. "When the facts change, I change my mind. What do you do, sir?" -- John Maynard Keynes And Mish is wrong no matter what. <g>