From: LePatron@LeMetropoleCafe.com ... To: dougak ... 8/21/99
Le Metropole members,
David Tice has served commentary at the Toulouse-Lautrec Table entitled,
"Not King Dollar, Yet the Dollar is Definately Key."
"Our country's quietly deteriorating oil import situation highlights what
we believe to be an unappreciated structural problem for our economy and,
inevitably, our financial markets. Now dependent on imports for more than
50% of oil consumption, we will have little alternative going forward than
to pay whatever price the oil market commands. And if the dollar continues
to weaken and import prices rise, there is considerable potential for this
to develop into an intractable trade deficit problem with devastating
ramifications for the dollar."
Charles Peabody, commentary at Hemingway Table, "Bank of America Corp."
"The value of this portfolio is most sensitive to a change in three- and
six- month Libor rates. These rates have continued to rise, suggesting
further depreciation in the value of the swaps portfolio. Meanwhile,
I would argue that credit quality trends in the commercial loan portfolio
are also deteriorating. In short, there is a developing economic impairment
of Bank of America Corp's capital structure."
This week was a frustrating week for our camp. Much of the commentary in
"The Cafe" focuses on deteriorating credit conditions in the United States,
an overvalued stock market and the "bubble" along a special focus on an
incredibly undervalued precious metals sector.
The commentators at Le Metropole are not ideologues. We tell it as we see it.
And what we saw this week confirms what we have been saying for some time now.
U.S trade deficit has gone to "hell in a handbasket"; the dollar is swooning;
the swap (liquidity) spreads remain at decade high levels; the TED spread is
at historically high levels; the bond market refuses to rally; the breadth
and A/D technicals of the stock market are terrible - and so on. Yet, the
stock market defies gravity, refusing to break, while gold suffers under
a continued bullion dealer onslaught.
lemetropolecafe.com
Le Metropole Cafe
Bill Murphy, Le Patron |
