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  • Analyzing Market Troughs and Rebounds [View article]
    Considering only debt and ignoring assets is IMO an unfair comparison. While it is true that debt has grown over the past several years so have assets. The problem has been the recession is devaluing those assets leaving the debts intact. Enter the Federal Reserve along with their international counterparts. The increase in money supply and interest rate decreases will reduce the decline in asset values and reduce the cost of the debt. Those who believe that debt will drag the world into a black hole regardless of central bank monetary policies and government fiscal stimulus packages are mistaken. The global economy will recover and economic growth will resume.


    On Dec 21 02:52 PM BrucePile wrote:

    > To say that this downturn can be modeled after the ones in the past
    > is to say that debt doesn't matter. Nobody is saying that global
    > debt isn't far and away more ponderous now than at anytime in history.
    > I don't think you can say that we're not in the unwind phase of that.
    > So how can we say this downturn must behave per past episodes? Not
    > that we won't have bear market rallies that run for months or years
    > (one of which may be starting now), but we are likely getting back
    > to markets that are not artificially powered by debt expansion and
    > that may take some doing.
    Dec 21 23:24 pm |Rating: 0 0
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