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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (24697)	11/24/2009 6:06:40 AM
From: RockyBalboa	Respond to of 71475

i believe that bond prices are goosed up with little sellers present as the yearend approaches, much like last year. This is done to limit losses of the various institutional bondholders as well as FCBs. And remember the skilled but in the end, hefty squeeze last year which put the 30-Y contract to 140 and over. Therefore I expect at least steady to rising bond prices until end of this year, and a decline from January onwards, much like last year. Treasury bonds have to go nowhere but down, in the long term. (Remark: I was pretty bullish on bonds - for tech reasons - around mid-year when everybody pointed out the huge issuances but underestimated the dollar printing capabilities of domestic U.S., but fundamentally it is still a depressing outlook, mired between economic depression and rampant inflation)

To: Skeeter Bug who wrote (24697)	11/24/2009 9:06:40 AM
From: axial	Read Replies (1) \| Respond to of 71475

Agreed, Skeeter. A crash would have triggered instant uncontrolled deflation; deflation is what they've been fighting, and still are. Second stimulus? Very likely. Who knows, maybe another after that as the economy "porpoises" along. Very few options left... if by some unforeseen magic the economy does improve significantly, then there's the now-latent risk of hyperinflation. But controlling liquidity and raising interest rates would stall the economy again, trigger new mortgage defaults, and push national debt payments towards "impossible". The bag of monetary tricks is almost empty. Jim