Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: RJA_ who wrote (62479)	4/4/2010 2:25:24 PM
From: carranza2	Read Replies (1) \| Respond to of 218094

Rosenberg was saying several things to support his argument; 1. Boomer retirement funds will increasingly be going to bonds, including Treasuries, because our investment needs as we age will emphasize safety over risk. More fixed income=lower yields=bullish market for Treasury instruments; 2. He believes the Japanese and Depression examples support his thesis that credit deleveraging=deflation or disinflation and takes 5-7 years to run its cycle during which history shows bond yields remain low. 3. The 'bonds are trash' argument/trade is too crowded, too facile. I think the Depression example might be flawed because my impression is that we did not have nearly an equivalent amount of stimulus - which implies public debt growth - during the Depression as we have had in the current cycle. Nor did we have the huge amount of unfunded liabilities we have assumed in the past few years. Thus, Rosenberg might not be taking into account these factors which will influence Treasury bond yields upward; I find this unlikely but I don't think he mentioned them during the debate. On further reflection, I think Grant's arguments, though presented a bit less forcefully than Rosenberg's, also have a lot of merit. The audience, a sophisticated bunch, seemed to have thought so, too.

To: RJA_ who wrote (62479)	4/4/2010 7:08:01 PM
From: TH	Read Replies (1) \| Respond to of 218094

RJA, < Grants arguement was pretty easy to understand. I'm not sure I really understood Rosenberg. Perhaps I need to listen to it again. What was your take on what Rosenberg was saying?> We share some thoughts about this debate. I think they could both very right, but in what time frame is the question. What I found interesting is that either guy could have easily debated the other side with just one or two changes in a base assumption. Grant wins from the contrary perspective, for what he is saying is that the long cycle shift is upon us and most won't see it because of "muscle memory". That is one of the key statements I took from his side. Rosenberg makes one critical mistake. He assumes that US dominance of the global capital market continues. That is the flaw in his position, at least from my perspective. GT TH