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Posts by "daveo"
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Posts by Anonymous "daveo":
http://www.frontlinethoughts.com/article.asp?id=mwo121010
"But what do interest rates, QE2, debt, and lower wages have to do with each other?
QE2 and the nervousness of investors around the world are pushing up interest rates. We in the US may not have as much time as we think we do before Bang! and rates start moving up with a vengeance. And no amount of QE3-4-5 will bring rates down when the bond vigilantes strike fear into the markets.
Further, that money is not showing up in new loans to either consumers or businesses. It is showing up in asset prices like stocks, emerging markets, and commodities. Oil at $90 and gasoline at $3 per gallon is a tax on consumers, especially at the lower end of the scale. Food prices climb as grains explode, along with the metals that go into our products. And rising interest rates are not good for mortgages. QE2 is not helping consumers or the housing market. Those are unintended consequences. I am sure that was not the plan. It is helping banks with a steeper yield curve. And maybe that is the plan".
Exactly right ! Predicting the future and debating interesting macro economics is one thing. Trading is another thing altogether.
China have a variety of potentially destructive problems but it takes lots of time for a very old culture to change. They have made progress with change but we need to be patient and by that I mean many decades rather than months and years.
The world is in an almighty mess even without mentioning religious conflict. It will probably take 20 years yet just to deleverage financial systems. Let's hope the scientists can come to to the rescue in time so new industries can be created. Printing money or QE2 cannot go on forever and the power of the banks over government is a very real problem indeed.
I don't think any G.20 nation can claim to be whiter than thou. All have very real problems. We each need to be producing something useful other than spinning money around in circles. Ultimately the basic laws of nature will take hold unless government comes to its senses.
I think its a good idea re Ashraf converting his site to paid service. Maybe then he could upgrade the forum platform to something more user friendly but I expect there are many implications to the idea from his perspective.