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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Night Trader who wrote (43765)	12/12/2008 9:01:26 AM
From: THE ANT	Respond to of 217795

Inflation will not solve the problem.The main issue is that the ratio credit to GDP is going to go down no matter what and thus asset values will decrease relative to labour no matter what.Thus it may take 10% inflation to hold asset values from falling.Asset holders will still be worse off and have to save more for retirement.Elroy thinks debt is easier to write off in a deflationary liquidation so I am not convinced the fed wants inflation,only no deflation.Either way real US debt will be written down and that is in my opinion why the dollar has not crashed (short squeeze on dollar bears also has helped up until now)When your debt is in your own currency it is hard for your currency to crash as the worse things get the less debt you will need to pay off in the long run