onsdag 13 april 2011

Pento om USAs falska återhämtning

Det är obehagligt att ligga lång när jag vet att det ska gå åt skogen. Jag chansar ju verkligen på att det finns en Bigger Fool därute som ska ta mina aktier när det blir dags. Är det en Dead Cat Bounce idag innan det rasar vidare, eller var gårdagen hela korrektionen? Jag hoppas på att det trasslar sig uppåt för Wall of Worry nu, men Pentos klara tankar nedan gör det inte lättare att hålla huvudet kallt:
Michael Pento, Senior Economist at Euro Pacific Capital
Gold, oil, the CRB Index, foreign currencies and Treasury yields are all screaming at Bernanke that it's time to join Mr. Trichet in a fight against inflation. But the sad truth is that the double-dipping real estate market and the onerous U.S. debt levels prohibit interest rate hikes without dire consequences in the short term. So Bernanke and Co. prefer to play politics instead of doing what's correct. However, what they are missing is that the bond market doesn't play any games at all. The yield on the 10 year note is up nearly 40 bps since March 16th and has surged nearly 120 bps since October.

So the only real question is whether the Fed will get ahead of inflation and take rates higher now or will it merely watch the market adjust interest rates to reflect rapidly rising inflation. In either case, rising rates will expose the phony recovery for what it was the entire time—one that was based on artificially produced low rates, inflation and debt. The only difference being the longer Bernanke insists on perpetuating this phony recovery, the higher interest rates will eventually have to go and the more damage the economy will have to suffer.

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