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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: macavity who wrote (5409)	1/8/2002 12:34:40 PM
From: NOW	Respond to of 33421

nice post.

To: macavity who wrote (5409)	1/8/2002 4:26:54 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 33421

Agreed.. you're points are well made, including the same ones I made about US manufacturing workers getting screwed. And the trade war is more likely to be between Asian nations than it is between Asia and the US. They will fight to preserve what remains of their market share of US trade. And it could become a big source of contention between the US, Japan, and China (the rest of the Asian small fry will be left to wither on the vine). So such a deal helps to buy the Japanese and American economies' some "time", with a quid pro quo. We may maintain favorable trade relations with Japan, at the expense of China and the rest of Asia. But what I mainly see here is a pressure release valve for the Fed, which has been forced to manipulate monetary policy with an ever-diminishing set of tools (namely US Treasuries being paid off by the previous surplus). We're in deficit spending mode with the war going on now, and probably need to be. So long as the Japanese are the one buying US debt, it will free up US banks to issue more loans. The "bubble" may be set to grow larger, but it's the Japanese who will be left holding the bag whenever the USD dollar peaks out. Again.. I welcome any criticism of the analysis. Hawk