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Technology Stocks : DELL Bear Thread
DELL 119.89-2.3%3:46 PM EST
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To: lin luo who wrote (1769)9/1/1998 1:52:00 PM
From: Lee   of 2578
 
Lin,..Re:<<Hong Kong Government Intervention>>

In October 1987, the Fed intervened in our market by adding liquidity to facilitate market transactions and stabilize conditions. Recently, the US Treasury in conjunction with BOJ intervened in the Forex markets at a very opportune time to quash currency speculation almost gone rampant. This is not a new practice as several years ago, it was a regular occurrence.

It is my understanding that the intervention of the HK government was based on the same meticulous timing in that last Friday was option expiration and the speculators had to cover their shorts or suffer more extensive losses. I don't think it is wrong for a government to defend either it's currency or markets when speculators attack. I think the timing was brilliant.

If Thailand and Malaysia and others had not squandered their reserves, they could also have defended their currencies in the face of global hedge funds and speculators without incurring the horrendous devaluations that they now have to endure.

Unfortunately, I am not familiar enough with history of China and Hong Kong to be able to know what has transpired in the past, but based on the very little information that I have, you are correct in saying that China has managed very well in the past to stifle this destructive component.

Regards,

Lee
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