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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (38609)	8/8/1999 12:54:00 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 116764

I am really giving you the spotlite this morning Well, thanks Morgy.. I don't mind this morning since I'm sitting here watching a movie and catching up on some long neglected threads. About Summer's comments on the dollar, this is what I was referring to by the US playing financial "chicken" with the Japan in order to get them stimulate their economy. The Japanese are major incrementalists. They do things in half-measures even when extreme responses are necessary. This is what has caused their interest rates to fall to 1/4 point as they understimulated to counteract the deflationary pressures in their economy. What Japan is trying to do now is not sufficient. There are two arguments I have heard as to what approach they should take. The first is a defacto devaluation of the yen by printing money (not through direct devaluation, mind you) and monetizing their debt and spurring higher prices so that the people, as they see prices rising, no longer have a reason to put off purchasing decisions until later knowing that prices will fall. The second is to announce a deliberate and public devaluation of the yen by some 25%... This would have MAJOR political and economic repercussions, but it just might be enough to convince investors and consumers that now that the worst is finally out of the way, they can now look forward to forward progress and not continue to fear for the future. The result of such a devaluation would mean a surge of capital fleeing temporarily in advance of such a measure, but capital would come back immediately after from bargain hunters. (brazil was a prime example of this). And I don't think we need stipulate the tie-in to gold to discuss this matter, since its context is directly link to the global economy and what directly impacts the price of gold. Regards, Ron