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Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: marginmike who wrote (168893)	5/29/2002 7:20:54 PM
From: Lucretius	Read Replies (1) \| Respond to of 436258

LOL... who knows.. maybe he will get it right

To: marginmike who wrote (168893)	5/29/2002 8:34:46 PM
From: Haim R. Branisteanu	Read Replies (1) \| Respond to of 436258

Goldman's Dudley Warns Of Risks Of Sharp Dollar Decline WASHINGTON (Dow Jones)--Goldman Sachs Economist Bill Dudley said a sharp decline in the dollar presents one important risk to the consensus view of a sustained, non-inflationary economic recovery. "A sharp dollar decline would hurt U.S. growth prospects," Dudley said in an economic comment Wednesday. "The nominal trade deficit would widen initially and the yield curve would steepen. It also would raise U.S. inflation." Dudley said this risk is "significant" because the dollar is significantly overvalued. He said a sharp decline in the dollar's value would prove difficult for policymakers, placing the Federal Reserve in an uncomfortable position as both the growth and inflation outlook deteriorated. "Moreover, there would be no easy remedy," the economist said. "A tighter monetary policy might not prove supportive because it could be viewed as damaging to U.S. growth prospects. Currency intervention probably would be ineffective." Wrapping up his comment, Dudley said: "A sharp dollar slide appears almost inevitable at some point. The imbalances are too large and are growing too fast to be unwound smoothly. The timing, of course, is highly uncertain. But we believe it makes sense for investors to stress test their portfolios to see how they would hold up if the dollar were to slide significantly." -By John Connor, Dow Jones Newswires; 202-862-9273; John.Connor@dowjones.com (END) Dow Jones Newswires 29-05-02