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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: valueminded who wrote (70419)	11/12/1999 9:08:00 AM
From: Earlie	Respond to of 132070

Chris: We are working on a couple at the moment. The homework required on these is substantial. As far as an obvious up-and-comer, one would have to go a long way to beat RMBS. This one looks exactly like Iridium did about 16 months ago. (g) Incidentally, I did a lousy job of explaining what I meant by "treasury selling" What I should have explained was that offshore central banks and other holders of U.S. treasuries are tired of being beaten up twice. They lose as the price of the treasuries fall, and they lose again as the U.S. dollar falls against their currencies. As a result, they have been quietly selling their treasuries. Obviously, they prefer to sell them back to the Fed, as this does not stir up the bond markets (which would only add to the downside pressure). On the other hand, when the Fed becomes recalcitrant, they will do so, just to provide "Big Al" with a dose of reality. In the end, "net selling" is what counts and that is what got underway last year for the first time since WW2. That is why U.S. rates must continue to rise,....to keep that tidal wave of IOUs offshore. If the wave were to wash ashore, the U.S. economy would be rapidly and badly trashed. Best, Earlie