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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: J. P. who wrote (40035)	5/16/1999 2:46:00 PM
From: Peter Goss	Respond to of 94695

JP and all, I think there are two tracks in this inflation question. The financial assets in the US are suffering from massive hyperinflation based on the money growth and AG's foolish attempt to save LTCM and eliminate risk premiums. The non financial world is under massive deflationary pressures from overcapacity and productivity, plus the recent little manufacturing spike is from inventory builds ahead of the Y2K situation. The whiff of price inflation is going to be the pin that bursts the financial bubble. When that happens, all hell will break loose: a giant credit liquidation and a giant deflationary wave that will take the real economy (and all of the "stabilized" trouble spots) down with it. There was a Volcker comment recently about the world economy being dependent on fifty stocks in the US. I think that is spot on. So rates will spike on fear and repatriation and then plunge as the massive credit bubble deflates. Just my scenario. Peter