February 11, 2007
Could it happen here? The housing-crash doomsday scenario
As HP readers know, all bubbles end with a rush to liquidity, and cash. Unfortunately, in this mother-of-all-bubbles, even the safety of liquid cash will come into doubt as the dollar goes into freefall due to the over-extension and massive trade imbalance of the US government.
Here’s a snippit from The Day After Tomorrow by Puplava and Barbera. You owe it to yourself to at least hedge against a housing-collapse-inspired fiscal meltdown. And damn, even if it doesn’t happen as predicted below, that’d be one good movie, eh?
As stocks of all types collapse, bond traders recognize the tremendous deflationary affects inherent in a falling market, rationalizing that a negative wealth affect will completely dampen consumer spending and at the same time, import price inflation. FULL ARTICLE: *Housingpanic.blogspot.com
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