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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (2016)	8/6/1999 6:31:00 PM
From: Henry Volquardsen	Respond to of 3536

"U.S. Should Raise Interest Rates Unless Demand Growth Slows-most Imf Directors"; however, I think that this received wisdom will be equivalent to raising tariffs in the 1930s. agreed. The IMF is clueless as usual. I've been wondering a lot about the rest of the world if the US economy slows. There has been a lot of talk recently about the decline in the dollar being the result of money returning to foreign markets lured by strong growth in those economies. Well in many economies, particularly in Asia, a lot of that growth is the result of exports to the US. Domestic demand remains constrained. If you couple a weak dollar with a slow down in US demand it could have significant impacts the US. I was discussing the US bond market today and the question, as always, was when will the US bond be a buy. My arguement is that it will be neither a time or price trigger. In other words we are not looking for a particular yield or point in the cycle. I believe it will be an event trigger. The event will be a 'crisis' in the emerging markets. The 'crisis' will be the result of slowing exports to the US and a slow down in foreign investment on localized Y2K concerns. Until that event I believe the US bond and the dollar will remain under pressure.