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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Ilaine who wrote (18908)	5/13/2002 1:14:38 PM
From: TobagoJack	Read Replies (1) \| Respond to of 74559

Hi CB, I hope there is a breaking mechanism for the dollar descent other than the concrete bottom. I think it may be imprudent to underestimate the splash damage of dollar implosion this time, as opposed to all times past. The analogy that comes to my mind, perhaps overly dramatic, is the gasoline lines of the early 70s, but with companies and individuals lining up at loan counters, and waiting. The true downside, of course, extrapolating from current news flow, could be gas lines and money lines, night after awful night, on CNBC. I do not suppose you have reconsidered the role of gold in your portfolio? OT: CNN reports ‘breakthrough’ in nuclear weapon reduction talks. The local Russian English language paper reports that Russia will start testing nuclear weapons again. Seems a very unilateral move for a defeated empire, except, of course, the folks here are simply responding to the unilateralism of others, and do not feel particularly defeated, CNN report not withstanding. I do not know whom to believe in and so will not bother to give CNN the benefit of the doubt. Chugs, Jay

To: Ilaine who wrote (18908)	5/13/2002 2:25:10 PM
From: smolejv@gmx.net	Read Replies (1) \| Respond to of 74559

>>Sure it affects industries that are dependent on foreign prices. But if, say, French wine gets expensive we'll drink more California wine.<< That smacks somehow of Marie Antoinette, who wondered about the masses outside the Versailles castle, clamoring "give us bread, we have no bread": "well, why dont they eat cakes instead". or... (a stale joke): "Daddy, where is Africa?". "Well, cant be that far away, there's a black man I see every morning, riding his bike to his office". dj

To: Ilaine who wrote (18908)	5/14/2002 12:09:18 AM
From: Maurice Winn	Respond to of 74559

<I've lived through strong dollar and weak dollar, over and over, and it just does not have that much of an effect on the US economy as a whole.> CB, do you remember in the 1980s, they were getting ready to have parity parties when the pound and dollar were expected to be equal? It never happened - the pound dropped away again. In 1995, there were 79 yen to the dollar. Japan warned everyone that this was unacceptable. The foolhardy thought they could do a run on Japan. Japan did a run on them! As Jay warns [and I have also decided] it is not a good idea to bet against the jujitsu currency. Banks are obviously nervous too. A while ago, my financial advisor and I investigated whether to borrow a big stack of yen at 0.5%, convert to NZ$, buy a bunch of houses, with big mortgages, rent them out, hedge the currency forward a few years, make a fortune. The banks dissuaded us because to cover that currency hedge, they want a VERY large return. They are scared witless about betting against Japan and did not want to take that risk on for us. I'm reluctant to take it on myself. Therefore, I continue to bet on CDMA. As well has retreating a little Tonka Truck of cash into NZ$ in case US$ isn't quite as robust as it was. However, betting against a 400 kg gorilla isn't much smarter than betting against a black belt in jujitsu. The gorilla is likely to use brute force. Being a little monkey and not skilled in jujitsu, I will remain concealed in the cyberspace world of CDMA and the distant world of Hobbitland. They can't get me there. I agree, the dollar goes up and down, from 250 yen to the dollar to 70 yen to the dollar over the last couple of decades and it doesn't end in mayhem, though there are significant adjustments by various parties, as you say. It's nice to be on the right end of the trades though. That's a pretty hefty range. The NZ$ has ranged between 39c and 69c over the past decade [currently at 45c]. Mqurice