Wednesday, August 4, 2010

Stake Out

No place for beginners or sensitive hearts
Sentiment is left to chance
No place to be ending but somewhere to start
--Sade

Nice assessment of inflation vs deflation risks offered, I suspect, by Mr P. He suggests our fate depends on gov't, particularly w.r.t. the Fed.

While many believe that monetizing till kingdom come is a layup, Mr P seems to think that undershooting is more likely. Me too. 
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3 comments:

dgeorge12358 said...

Whilst it is true that from peak to trough, private-sector debt in the US contracted by roughly US$800 billion, this debt reduction was overwhelmed by the US government’s debt accumulation efforts.

Over the past two years, US federal debt has surged by a whopping US$3 trillion, thereby more than offsetting the deflationary impact of private sector deleveraging.

Total debt in the US is now at a record high!
~Puru Saxena

August 4, 2010 at 9:44 PM
dgeorge12358 said...

Money velocity may be a metric to monitor as corporations and banks are holding a large amount of cash and reserves, but don't appear to have the desire to deploy in the current environment.

August 5, 2010 at 7:59 AM
fordmw said...

What happens to total credit stats if they are adjusted for nonperforming loans and their underlying assets that have not been marked to mkt?

August 5, 2010 at 8:23 AM

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