Deswell Industries (DSWL) Message Board

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Technology Stocks : Deswell Industries (DSWL)

DSWL 3.390

-0.3%

Nov 7 9:30 AM EST

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To: Ron Bower who wrote (929)	8/27/1998 11:38:00 PM
From: Terrapin	of 1418

Thanks Ron for the great explanation. I'm sure it will take me awhile to fully understand (I'll keep an eye out for that Barron's issue). But the whole idea does trouble me: The HKMA is forced to raise interbank loan rates (like the Fed Funds?) in response to hedge funds shorting the currency. The increase in rates hurts the profits of the largest companies in the index (banks and REITs) which is then prone to decline. To prevent this the government (through the HKMA?) buys stock in these banks and REITS thus propping up the shareprice. This will then result in a short squeeze of the hedge funds(?) forcing them to lose money and hopefully go away. I'm glad they admit that this is no long term solution. Makes me wonder how long they can continue and what will happen to Deswell if they can't. For me to understand the effect of de-pegging the $HK from the $US on Deswell will take even more time. Meanwhile I sit with my finger on the trigger and DSWLF in my sites. I can't believe I have a chance to buy this company so low and I further can't believe that I haven't done it yet! :o Thanks for the reply, John

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