It is likely that the "eventually" that Greenspan
and others have been talking about for so many years may finally occur in 2006!
Clearly, to "save the dollar" Greenspan will have to continue raising rates--ALMOST INTO THE INDEFINITE FUTURE...
THIS SEEMS TO BE THE "SECRET MESSAGE" THAT GREENSPAN AND OTHER FED MEMBERS ARE TRYING TO "TELEGRAPH" TO THE MARKETS...
"WE AIN'T GONNA STOP NO MATTER WHAT!"
Now what part of that doesn't Wall Street understand...Greenspan simply must continue raising rates "forever" to justify foreigners holding dollars...
I think a 7% yeild on the 10 year bond by the end of 2006 is "doable" AND that assume there are no catastrophic events to grease the skids...
Ultimately, the 10 year bond "should be" about 10%-11% to justify the type of economy the US has become... ONLY THAT WOULD HOLD OIL PRICES DOWN GOING FORWARD...AND ANYTHING LESS WILL BE MASSIVELY INFLATIONARY...WHILE THE AMERICAN CONSUMER IS STUCK WITH LOWER WAGES AND EVER HIGHER COSTS... To wit: a deep recession.
That alas, will be the new Fed Chairmans "conundrum" in 2006...!
