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To: Lucretius who wrote (55429)	8/6/1999 10:32:00 PM
From: pater tenebrarum	Read Replies (3) \| Respond to of 86076

Luc, there is a rumor going around that the Tiger hedge fund is in deep trouble over yen-carry trade positions; apparently they had borrowed gold, sold it, and leveraged the proceeds up via Yen and Swiss Franc loans until they had a total market exposure in stocks and bonds of $650 billion. the rumor includes speculation that both the BOE gold sale and the BOJ's interventions to prop up the buck were directly related to Tiger's troubles, lest the fund's insolvency take the whole system down with it. i remember that shortly before the first big BOJ intervention there was a rumor going around on WS of a secret Fed meeting over a troubled hedge fund. anyway, they go on to say that the weakness in bonds, the strength in the yen and the continued weakness in gold are a result of Tiger unwinding it's positions and blatant manipulation of the gold market to avoid their gold short going against them. if this is true, it would help explain the recent weakness in banks and brokers as well, as GS and CMB are said to be among those involved and facing potentially huge losses. the rumor also has it that a secret G7 bail-out plan for Tiger was agreed upon to avoid Tiger having to sell stocks and initiate a meltdown - thus the obviously idiotic step of announcing the BOE gold sale in advance, which no other central bank has ever done before, as it would obviously depress prices ahead of the sale. let us assume, for argument's sake that all of this is true - it would explain a lot of strange goings-on, from the BOJ's inability to hold down the Yen for more than 5 seconds in a row to the extreme weakness in bonds in spite of the generally accepted theory that one or two 25bp. hikes is the most the Fed will be willing to implement ahead of Y2K. normally the bond market rallies as soon as everybody is reasonably certain of the moves to be expected from the Fed, unless of course if it is hit with a constant source of supply in the form of the unwinding of Tiger's positions. even the timing of Summers' bond buy-back press release and the leaks about talks between him and Miyazawa about possible Yen/buck interventions take on a sinister hue when viewed in the context of the Tiger rumors. apparently Tiger's net value is about to be cut down from $22 bn. to $6bn., as it faces not only massive losses, but also $6bn. in redemptions. well, probably it is all some paranoid speculation hatched in the overactive minds of conspiracy theorists, but wouldn't it be nice if it were true? a meltdown of awesome proportions would be all but assured....