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

To: Henry Volquardsen who wrote (2642)	12/21/2000 11:46:30 AM
From: Robert Douglas	Respond to of 3536

Good point Henry, I agree.

To: Henry Volquardsen who wrote (2642)	12/22/2000 3:41:31 PM
From: Archie Meeties	Read Replies (3) \| Respond to of 3536

It's not just the euro traders. You'd be pained to find a soul anywhere that believes that rates (first in the US but later in Europe) will not drop at least 75 bp over the next 2-3q's, with the first round imminent. I expect many have invested accordingly and consequently the first fed cuts will be met with selling (after a day or so of euphoria), just as fed hikes were met with buying in 99.

To: Henry Volquardsen who wrote (2642)	12/22/2000 8:16:39 PM
From: Zeev Hed	Read Replies (3) \| Respond to of 3536

Henry, how have you been? I was surprised like everyone else by the sudden sharp decline in short term rates, so I looked for a reason. I could not find any, until I looked at the National debt in the last few weeks. Well, in the last week it declined by a whooping $75 Billions. I believe that the current swoon down is an aberration due to large receipts of corporate income taxes and the government parking these in T-bills, it will evaporate. The talk about the feds reducing rates, is IMHO, nothing short of leading the "lambs" to the altar, so they rush and buy stock that the big boys have not had a chance to unload as yet. It also plays well with the fear mongering our Pres and VP elect are engaging in order to pave the way for the tax cut plan. Do you eally think that AG will lower interest rates when unemployment is hovering .1% above its all time low? When durable goods numbers are perking again, when new jobs creating exceed consistently 30,000 per week? I think that until we see the unemployment at 4.5% at least and for at least few months, not an aberration, the Feds will have no reason to prime the pump. Any priming they do will end up in the financial markets and they are not interested in another bubble. Of course, a financial catastrophe here or abroad, that is another story, but AG will keep his powder dry, IMHO, until such a catastrophe forces his hand. Happy holidays to you and yours Zeev

To: Henry Volquardsen who wrote (2642)	12/23/2000 3:39:49 PM
From: John Pitera	Read Replies (1) \| Respond to of 3536

Hi Henry, The Feb Fed Funds rate was pricing in an 82% probability of a 50 basis point cut by Feb. is forecasting, imo, over 100 b.p. by June. the global economies are really slowing down recently. Liquidity concerns seem to be increasing in Asia, especially in Korea, and the BoJ is talking about deflation once again. You were spot on when I asked you several months ago about the yen, and you were looking for yen weakness over the intermediate term due to structural problems in Japan. a weak yen which took another hammering after the BOJ's Hayami acknowledged that the economy could slip back into deflation. A great trade would to have been to get long the Euro/short Yen on the cross, during the last week of Nov. The global stock indicies have been selling off, and since the equity markets have such an impact on the Global Economy these days I guess it makes sense that we'll see some fairly agressive easing by the FED in the next 6 months. Have a great Holiday. I'm goint to Tokyo on Tuesday, for a week. John

To: Henry Volquardsen who wrote (2642)	12/25/2000 12:59:28 PM
From: dean poets	Read Replies (1) \| Respond to of 3536

Could it actually be a 1-2% increase in interest rates in 2001? There has been a lot of wealth disapeared in North America over the last 8-9 months. People's money is shrinking in the latest Nasdaq Bear. Even my grandma was buying high tech's. Less investment capital or shrinking capital usually means the goverments have to raise rates on their bonds. Commodities prices have been rising sharply the last year, and the fed still says there's no INFLATION. Almost everybody agrees the the U.S. economy is slowing severely. If the goverment lowers rates, they could open up a case for Stag Flation. Historically interest rates cycle up & down between 4% to 20%. Although nowadays people don't seem to think interest rates will ever rise that high again. People have this notion that the economy is different now, that it will never change. Sorry folks, history has a real tendency to repeat itself. Dean