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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: donald sew who wrote (16873)	6/11/1999 2:10:00 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 99985

Don, re: foreign money leaving U.S. markets: this is why the good news from Japan is such bad news for the U.S.; an analogy used to describe the U.S. bond market is that the U.S. have the house, but Japan holds the mortgage. even if only a small amount of the japanese funds in U.S. treasuries leaves the market the effect will be felt. i do think that is what is happening now and some hedge fund managers 'in the know' are trying to take advantage of this by shorting bonds at these key technical levels. the most worrisome aspect of this is that the stock market has by no means 'priced in' current bond yields. as i have mentioned in my post to Jim yesterday, what's priced in, is a rebound in the bond. if no rebound comes, the 'pricing in' phase is still ahead of us and likely to be violent. regards, hb

To: donald sew who wrote (16873)	6/11/1999 3:13:00 PM
From: Trey McAtee	Read Replies (1) \| Respond to of 99985

don-- i am thinking 6.15% plus or minus 2 basis points. that is about as far as i think they will let it go. its just too obvious and people are really scalping on the short side, getting way too greedy. was thinking about banks earlier today... the bonds are getting out of whack with where the feds rates are. maybe this will be good for financials instead of hurting them. by driving up bonds, they are making it more profitable for banks to loan money. here is some more info...one of the posters on the DCLK thread posted it here i think... there is finally an analyst (keith benjamin at BB RS) who appears to get it re: rates and where they would have to be to cause a shift out of equities. his estimate was a little higher than mine, but still pretty close. basic point, we have to see bonds at or above 10% for it to be worthwhile to shift from equities to debt. good luck to all, trey