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

To: maxncompany who wrote (100609)	8/10/2009 3:22:53 PM
From: Amark$p	1 Recommendation Read Replies (3) \| Respond to of 116555

Mish owes us an article on this subject - i.e. bank holiday coupled with US$ devaluation. I respect Mish opinion and to my knowledge he has not commented on this... All real assets would benefit, including gold, IMO. Inflation expectations would rise, money velocity would rise. US would inflate itself out of debt. Highly levered banks and US companies would see their debt obligations fall signficantly. If you are US company with 60% debt ratio in US$ debt, a 50% devaluation would do wonders for your balance sheet. FNMA and highly levered banks with lots of REO foreclosed properties on their books would benefit. A 50% devaluation is likely too drastic. A 10% devaluation would probably be enough to raise inflation expectations and money velocity.