Lets talk some turkey

With the rate cuts, and the continued dollar weakness...

(1.468 to the euro isn't that strong)

it's hard to see weakness in financials, or materials.

Financials:

with the fed cuts, and the Ridiculous ability of banks to borrow at half what they are loaning at... AND the 9/1 loan ratio...

Borrow at 2.5% $1000=$25 cost
Loan out $9000 at 5%=$450 return, $425 ROI(42.5% profit)

and that doesn't even include the money they borrow from depositors.



Materials:

in a normal recession there is the normal pattern of deflation leading to materials weakness.... Question is Global growth. The demand on materials, will continue to be strong, and the weakness is probably weak lived.

I still like the stagflation call, the Narcissus of the U.S. that we will cause massive global slowness. It is likely that the global demand will keep prices high and help to provide strength in global companies... But this will also cause further weakness in the U.S. Economy, since everyone will be able to afford Wood, and copper, and gas, and food. and it will just get more expensive for us.... growing global countries will experience the inflated prices, but IMHO they will see 10% increases, and we will see 2 X or Two times that.. so 20%... Leading to further weakness.

I've said it before, we will wish for a regular recession... This won't be it..