Sunday, April 01, 2007

It's Delightful, It's Delovely, It's Deleverage! / contrary investor

usa = asset inflation nation :-). make sure you read the full piece and click on the headline. this is only a very small part of the very good analysis

lege euch die volle dosis ans herz. diese hier ist nur ein kleiner ausschnitt. bitte auf die ├╝berschrift klicken.

....US economy itself, otherwise known as the Asset Inflation Nation!

real estate and equity price inflation has driven two thirds of the increase in household net worth in the current decade. ....The largest number we've seen in six decades at least...

And at this point, clearly in numbers too big to ignore.
Without belaboring the point, this change in character of household net worth creation over the last three decades has indeed influenced household consumer behavior as is clearly depicted in the chart below. Quite simplistically, have the drivers of household asset inflation beginning in the early 1980's influenced consumption patterns and the character of the US economy since that time? If the following graphical view of life doesn't answer that question, then we just don't know what does.

as always great stuff from

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