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Realistbear

Greenknickers: Higher I R On The Way

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http://uk.finance.yahoo.com/news/high-u-s-deficits-could-spark-bond-crisis-greenspan-reuters_molt-b63e524c9569.html?x=0

High U.S. deficits could spark bond crisis - Greenspan
Sunday 14 November 2010
WASHINGTON (
Reuters
) - The United States must move to rein in its massive budget deficits or it faces the risk of a bond market crisis, former Federal Reserve Chairman Alan Greenspan said on Sunday.
"We've got to resolve this issue," Greenspan said of the ballooning U.S. debt levels.
He spoke about the issue as a panel, chaired by former White House chief of staff Erskine Bowles and former U.S. Senator Alan Simpson, is due to deliver a report on debt and deficits by December 1.
A draft report made public last week offered a series of politically tough tax and spending choices that would seek to reduce the debt by $4 trillion (2.48 trillion pounds) by 2020.
The report received a lukewarm reception from some politicians and outright condemnation by others, including House of Representatives Speaker Nancy Pelosi, who pronounced the ideas "simply unacceptable."
Greenspan, who spoke on NBC's "Meet the Press," said he believed "something equivalent to what Bowles and Simpson put out is going to be approved by Congress. But the only question is whether it is before or after a crisis in the bond market."
He said the risk is that the deficit, which hit $1.3 trillion this year, could spook the bond market. That would result in long-term interest rates moving up rapidly and could lead to a double-dip recession
.

IR on the all-important 10 year are already rising. I noted a big jump in CDs on Friday from .20% to .30% on the 90 day note.

If there is one thing that will lay our overpriced houses to waste its higher global IR.

This coming week may be action packed with the Euro on the line, continuing super-strength of the pound and the bond market pushing IR up.

Edited by Realistbear

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he is a man of foresite who sees nothing in the future.

his major is the bleedin obvious.

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If they do go for a hike or hike(s) this year to get to a Fed funds rate of 1%, the case for the shiny yellow anti-dollar would be less clear cut if CPI was reported at around the same value. It would be commensurate with a take-down in precious metal prices, which I think will happen. Maybe precious metal prices continue to run until mid-year and then they start raising rates?

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Its a strange thing but I do not find Cleese at all funny these days. The opposite in fact.

Brilliant back then with Fawlty Towers perhaps being the 2nd greatest comedy of all time but unpleasant these days.

Edited by Realistbear

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Its a strange thing but I do not find Cleese at all funny these days. The opposite in fact.

Brilliant back then with Fawlty Towers perhaps being the 2nd greatest comedy of all time but unpleasant these days.

Hilarious in Monty Python, but I thought the whole of Fawlty Towers was a train wreck.

Edit - Back OT, I doubt we will see higher IRs any time soon. If inflation (CPI) pushes up above say 5%-6% than maybe they might raise it by 50 basis points.

Hang on to your pants people.

Edited by LJAR

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Hilarious in Monty Python, but I thought the whole of Fawlty Towers was a train wreck.

Edit - Back OT, I doubt we will see higher IRs any time soon. If inflation (CPI) pushes up above say 5%-6% than maybe they might raise it by 50 basis points.

Hang on to your pants people.

I doubt it, they will just adjust CPI again putting more gravel into the basket and ivory back scratchers as well.

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I thought he was the god father of blowing bubbles and ridiculously low interest rates!

Chump.

There will be no bond crisis as long as the US continue to monetise their own debt. How can bonds drop in price if you print ever higher amounts to buy them?!

Currency crisis, yes, possibly. But I thought they wanted to become poorer so they could export more and compete with China.

Where's the joined up thinking here?

Edited by libspero

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I doubt it, they will just adjust CPI again putting more gravel into the basket and ivory back scratchers as well.

doesnt really matter, the idea of higher rates is to slow money supply....as commodities rise, as they are dramatically doing, so the economy will slow further, as the gap in household food and fuel rise to meet low mortgage costs....they will cross, as they have for hundreds of thousands already, putting each and every months spend in the red for many.

course, its the people with the least that suffer disproportionately.

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Hilarious in Monty Python, but I thought the whole of Fawlty Towers was a train wreck.

How dare you Blaspheme against JC ..

How could "You started it .."

"No ve didn't"

"Yes you did you invaded Poland .."

Actually come to think if it .. you are right .. my children don't even see the joke in that ...

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  • 245 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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