Investing during a Bear Market Message Board

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Strategies & Market Trends : Investing during a Bear Market

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To: tekgk who wrote (9)	11/8/1997 4:41:00 AM
From: Paul M. Rengier	Read Replies (3) of 226

tekgk, let me add a little from a german perspective. first I have to admit, my gains in $-calls are reversed now, so I might not be right. But In GY it is generally accepted that a) The Euro is coming and b) it will not be a strong currency. You mix up currencies with different strength and cannot expect to be as strong as the strongest of them (assuming DM is one of the stronger) There are call options with a strike of 2.30 DM/$! Even if this will prove to be nonsense, there is a strong possibility of 1.90 DM/$ in the march-june timeframe. Interest rates have to be adjusted, the italian rates must come down, the german rates must go up (which goes against $). So if you see the DM at 0.59 or higher, this may be an ideal entry point to short the DM vs $. Keep in mind, that if the iraq crisis get harder, $ will fall against mark. The we may see 0.6! which is the point I would bet the farm on it. Paul

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