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delite1

Japan's Feb. Consumer Prices Rise

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Before you read the Bloomberg article below , may I quote a posting from this mornings TMF board. A poster

call AP Davidson refering to recent interest rate moves in Iceland.

"Author: SirXYZ | Date: 30/3/06 22:08 | Number: 130179

'Mr Oddsson said he was prepared to raise short-term rates “substantially from the current level, perhaps by several percentage points”'

Think of this as the financial tide going out. The flood of Japanese liquidity (that of the Chinese is different because theirs has been taken from the people and will have some time to be returned) has risen up the beaches worldwide like a slow tidal wave. It is now retreating.

What it is leaving high and dry are the countries whose deficits make then vulnerable. The UK is not in such an exposed position as Iceland or New Zealand. In comparison with France and Germany we are industrially lightweight but energy rich. However, a vulnerability has just opened up; our productivity growth rate has fallen to 0.8%, a PR disaster at this time of turmoil.

However, the US $ is the reserve currency. Our economy is tightly linked to the US. It is US IRs that we must fear.

I expect no run on the £ provided our IRs do not fall <0.25% below $ IRs. Since Bernanke has to maintain the parity of the $, 5% is easily possible and soon. In that case our IRs go up to 4.75%. If Bernanke raises rates to 5.25%, both the US and UK housing bubbles will cease being GSDs and will deflate rapidly as our economies head into recession.

I suspect the bulls are waking up to reality. "

http://quote.bloomberg.com/apps/news?pid=1...gxjI&refer=home

Edited by delite1

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Taps fingers wating for Japan to become the next property investment hotspot of choice for the global speculators and the nervous murmurings of "oh no here we go again" from the BOJ.

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  • 302 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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