Top of the Curve

Longterm thoughts

I keep feeling like we are headed toward a major recession and that we will see inflation followed by deflation. I think about this a lot - and I think we are starting to see the start of things via the housing markets decline which is obsessively talked about. With these higher rates mortgages obviously get tougher - again thats not secret to anyone. When you take a second and see what large financial co's exposure is to mortgage debt is pretty staggering.

One thing that many people dont talk about, and that I think is going to be a major turning point or mark in our history is the recent rejections of foreign co's trying to purchase US businesses. (china/unical dubai and the ports) (also see this its kind of interesting: http://journalism.berkeley.edu/projects/worldandus/archives/china/) China and Dubai are two very very large holders of US debt and continue to finance our economy. They are long dollars, and choose to invest them back into the US to which we say get outta here. I think that we have seen the peak of the dollar - at least in the near term.

I hate sounding like I think the US is going to 0, I just think rough times are ahead. Im getting short the US stock market, and also trying to hedge against a dollar drop most likely via gold.

posted by BKo @ 9:27 AM