Hey arjunah: Thanks for you cyles work.
My post was about global economy which is going through a defl -phase and US economy still the biggest, but ever so shrinking part of it. Real estate bubble in US and Europe was created by siphoning off excess global liquity created by BRIC& not so BRIC countries. That liquidity has gone in a flash by bursting of real estate bubbles. A couple easy to understand examples of liquidity destruction.
1. You buy fire works to resell for profit and through mishap they go in flames.
2. Dot com burst in 2000 when real money was lost as most enterprises went burst.
Liquidity destruction led to deflation, exacerbated by fear of falling asset values. In this age of hyper connectivity all players decided to get out of commodities at the same time. Hell a few months ago GS was calling for $ 200 crude and now there are calls for 25 dollars a barrel and it is not JUST oil that is getting cheap.
Truly, I was far more worried when oil was 147 dollars a barrel and it looked like we gonna run out of everything. Low and behold, here comes deflation....information age has shortened infl/defl cyles!
Yes bring on greed , everything is cheap. I see another infationary cycle being started creating a sea of liquidity, some of it will wash our shores even if we did not produce worlds best cars LOL.
AI
