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M
That "massive inflation" should help offset the "massive deflation" (hello
JA-PAN!) that you were predicting a month ago. Thank God things will
balance out.
Kent
----- Original Message -----
From: "M. Simms" <prosys@xxxxxxxxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Thursday, January 09, 2003 3:03 PM
Subject: RE: [RT] Long term interest rates
To the extent the war is long and costly, then YES.
If the quick-war scenario does not pan-out, then expect government borrowing
to increase significantly and eventually crowd-out corporate
borrowing....setting the stage for higher interest rates and lower growth
rates.
Only "fix" for this would be massive monetization i.e. money-creation
policies.....resulting in massive inflation.
Massive inflation also means higher interest rates...
Thus, at some point in time, the government must decide between high
interest rates and low growth or extremely high interest rates and nice
growth.
Right now interest rates are low because of low demand for money.
> -----Original Message-----
> From: Steve Walker [mailto:steve@xxxxxxxxxxxxxxx]
> Sent: Thursday, January 09, 2003 2:26 PM
> To: Realtraders@xxxxxxxxxxxxxxx
> Subject: [RT] Long term interest rates
>
>
> If there is a "war" with Iraq or N. Korea, should we expect the long
> term interest rates to rise? If so, this would make the yield curve
> more steep.
> So, perhaps after an initial decline could stocks be expected to move
> up as they did in the earlier confrontation with Iraq?
>
>
>
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