"I do not believe that is the path for US equities. However, I may very well be wrong. It is always important to consider what happens if you are wrong. Few bother to do just that."
Read more at
http://globaleconomicanalysis.blogspot.com/2012/07/time-to-short-us-treasuries.html#eDXIFDdu7I3sdYqP.99 (Mish link to same article
)
I also consider that I may be wrong. That is why I like assets that hold real value in either an inflationary or deflationary environment. After all, hyperinflation is only a different path to the same destination, namely deflationary collapse. Same animal species, just different spots. What will determine the outcome is policy and how people react to the policy. So far I have seen no indication of direction change towards austerity in our government. If I do I may change what I think is the most probable outciome. Also it is a possibility we will have neither. That would be the best possible outcome. I put it the least likely.
One big difference between Japan's debt and ours. Japan holds most of their own debt internally by a very patriotic population. Half of our debt is held by foreigners. Might make a difference in a panic market liquidation.
John
The bond market is the key
