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

To: Les H who wrote (176671)	7/1/2002 4:02:57 PM
From: Earlie	Read Replies (2) \| Respond to of 436258

Les: TGTKOG3 is still delivering. The only thing missing for yours truly is to watch them issue an indictment for Louis. I hear that more than the rating agencies are interested in the accounting. You heard it here first. Best, Earlie

To: Les H who wrote (176671)	7/1/2002 11:21:05 PM
From: Les H	Read Replies (2) \| Respond to of 436258

FOCUS US still seen happy at dollar drop; Fed intervention no signal of change -- by Christopher Anstey -- WASHINGTON (AFX) - The Bush administration is still perceived as comfortable with the dollar's relatively orderly decline over the past quarter, and the New York Federal Reserve's reported dollar buying on behalf of the Bank of Japan is not a signal of change, currency analysts said. "There really is no sign yet from European or US officials that they have much concern about dollar's decline," said Marc Chandler, chief currency strategist at HSBC. The New York Fed and European Central Bank reportedly intervened to buy dollars for yen at the request of the Bank of Japan, after the BoJ had already intervened repeatedly this week in Tokyo trading to brake the dollar's decline, after it broke below 120 against the yen. "This is totally protocol... just as a banker would do for a client," said Lisa Finstrom, currency analyst at Salomon Smith Barney. The Fed and ECB "must act" if the BoJ requests it; "it's not a sign of anything else," she said. Behind closed doors, the Bush administration continues to be seen as comfortable with the decline, as it should help ease current account deficit worries, and make US exports more competitive. Concern at the dollar's decline would only develop if the depreciation turned into a "one way bet" against the dollar, bringing US financial assets down in tandem, analysts said. Only at this point would Treasury Secretary Paul O'Neill begin to countenance the idea of foreign exchange intervention - a concept about which he has expressed great skepticism in the past, they added. It is the US Treasury Department that would make any US decision to intervene in foreign exchange markets for US purposes, and a Treasury spokesman said earlier the Treasury has "no comment" on the current operation. The spokesman noted reports that the New York Fed was acting on behalf of the BoJ. Finstrom said if the currency market sustained high volatility, "extreme movements," or a "one-sided market, which we don't have... then maybe under those conditions it would be appropriate" for the US to intervene to support the dollar. Alex Beuzelin, senior market analyst at independent market analysis firm Ruesche International, said today's operations "don't indicate a shift in policy of US and European officials." "The perception remains that they are not bothered by the dollar's decline," he said, as it provides additional stimulus for the US economy, and helps the ECB keep interest rates accommodative thanks to the disinflationary effect of a strengthening euro. O'Neill has said that intervention is not an effective tool, casting doubts over whether the Bush administration would use the mechanism on its own behalf. "I think there's a real doubt about the effectiveness of interventions or words about intervention," O'Neill told the Senate Banking Committee last month, explaining that he was talking "directly about interventions in world financial markets." Regardless of President George Bush's statement earlier this week about letting the market determine the dollar's value, "they would have to intervene" if the dollar fell dramatically, said Robert Hormats, vice chairman of Goldman Sachs International, on Wednesday. Given the pall in sentiment hanging over US equities, which has affected the dollar, it is impossible to rule out any future US participation in currency intervention, analysts said. "The markets still remain wary, investor confidence remains shaky, and that spells probably more selling pressure for the dollar," Beuzelin said. Finstrom said "the key is confidence, and we do have potential problems on that front." While Salomon Smith Barney sees fair value for the dollar at 1.02 - 1.03 to the euro, "obviously the market can overshoot." Chandler said that in the current environment "trying to engineer a soft landing to the dollar may prove difficult." "What makes it very difficult to call a bottom is that the market is not really trading on fundamentals," Beuzelin said, noting there is a "disconnect" between fundamental economic indicators and the state of investor confidence in the US. "Until that gap is bridged, the dollar will not be able to stage a turnaround," he said, concluding that "it's a very dangerous game to be calling a bottom right now."