Thanks, I wonder if we'll see 7 again, if we do, I'll buy...
From Nightly Business Report
Predictions About Japan's Bank Bail Out Plan
SUSIE GHARIB: Investors are on pins and needles waiting for more details tomorrow morning from Japan on its bank bailout plan. Ahead
of that, the Japanese stock market surged today, up about 5 1/2 percent. And surprisingly, so did the dollar. Here to tell us what to expect is
Deborah Lagormarsino of BridgeNews. Hi, Deborah.
DEBORAH LAGOMARSINO, FOREIGN EXCHANGE REPORTER, BRIDGENEWS: Hi.
GHARIB: So what are you hearing?
LAGOMARSINO: Well, you know, hearing a lot of expectations here. You know, there's signs the political logjam in Japan has broken, that
we actually are going to get some progress, and now we're looking for the numbers. What are the numbers, what are they going to be
committing to this package?
GHARIB: And by numbers, you're talking about how big a dollar figure is going to be on this bailout package.
LAGOMARSINO: Exactly.
GHARIB: What is the number that the markets' investors are looking for?
LAGOMARSINO: At this point, it's about $550 billion.
GHARIB: Half a trillion.
LAGOMARSINO: Half a trillion dollars, which is a heavy investment and could go some way to assuring the market. But the trick right now
where the market's at is short term, they see it as a negative. Really Japan's banking woes could take some time to sort out. In the long run it could be a positive. So there may be a little bit of some caution here still in the market.
GHARIB: One thing that is surprising is that given this bullish news for Japan, you would think that the dollar would be hurt on this, but
instead today, the dollar moved up a little bit.
LAGOMARSINO: Right.
GHARIB: Why is that?
LAGOMARSINO: Part of what that reflects is the dollar really just killed last week. It was down 14 percent against the yen, it's biggest
week drop ever, and you know it's just kind of steadying itself a little. We had a better performance today in the Dow. You know, there's a little bit...
GHARIB: Here, actually we're looking at that chart now. The dollar hit its peak in August, 147 today. It was 117. What's the forecast on the
dollar and the yen?
LAGOMARSINO: Well, people are kind of downgrading their forecasts a bit, given this volatility we've seen. They're now saying about
130, end of the year. That's down from about 150, and I even talked to someone today who cut it to 110 from 150. So, I mean the short
term negatives there of course are further selling from these hedge funds that are you know, trying to sell dollars. They're profitable trades to offset their losses in other markets, and also this possibility that Japan may come through with something.
GHARIB: Real quickly, back to Japan. We just have a few seconds left.
LAGOMARSINO: Sure.
GHARIB: If the number does come out to be a half a trillion dollar bail out package, is Japan in better shape you think?
LAGOMARSINO: Yes. I think there's a consensus that there's no question. This is the right step.
GHARIB: OK. Might be turning the corner then. Thank you very much for coming and talking to us. We've been speaking with Deborah
Lagomarsino of BridgeNews.
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The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of
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