Bond Outlook [by bridport & cie, December 3rd 2008]
Commodity prices are falling. Consumer spending is collapsing. Shops are discounting. Capex has halved. A stronger USD has led to lower import prices. Unemployment is rising. Unsold housing inventory is still increasing. All these things point to deflation, do they not? |
The US Government is borrowing massively. The Fed has lowered interest rates. The USD is vulnerable to foreigners repatriating their USD denominated assets and/or losing interest in buying more of them. |
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