Thursday, January 24, 2008
Want Some Cake With That Icing?
Attention investors: I understand you are feeling a bit dazed and confused by the recent volatility, warnings of imminent apocalypse by eminent persons, but please comprehend that you cannot have it every which way. Stagflation is decidedly BAD for equities. Stagflation is BAD for bonds, and even worse for bondholders who buy and hold bonds at HIGH prices. SO...please make up your mind: return equities to their path of converging towards equilibrium in deeply-recessionary environment, OR sell the shit out of the bonds to correct their panic spike over fears that said deep recession would cause them NEVER to see a "five" handle ever again.