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To: TobagoJack who wrote (23351)	9/16/2002 9:50:09 PM
From: Raymond Duray	Respond to of 74559

Hi jay, Thanks for that engaging post. Nine out of nine? Ouch. I lived in Ess Eff, or Bahgdad-By-The-Bay, for most of the 1990's so your story has an extra degree of poignancy. Re: War - I agree, the White House wasted no time at all rejecting a sensible offer from Saddam. The neocons are rabid and frothing at the mouth. Re: QCOM - yeah, I know. <gg> Salaam aleikum, Ray

To: TobagoJack who wrote (23351)	9/17/2002 2:06:22 AM
From: Kid Rock	Read Replies (1) \| Respond to of 74559

suntimes.com Hong Kong deflation hints at U.S. woes September 16, 2002 BY MIN LEE HONG KONG--''Cheap'' is not part of the everyday vocabulary in Hong Kong, where Prada designer handbags are as ubiquitous as McDonald's brown bags. But it's becoming more familiar to the residents of this city. For decades, Hong Kong grew dramatically, its high-rise buildings soaring ever higher in an economy based largely on property prices that had many thinking things could only go up in value. But they peaked not long after Britain handed Hong Kong back to China in July 1997, and Hong Kong has been painfully adjusting ever since to the idea that prices can also fall--not just for real estate but for food, cars and services, too. The danger in persistently falling prices--deflation--is that producers are unable to recoup their costs, putting them in a losing position and setting the stage for layoffs, bankruptcies or government subsidies. It's a surprising situation for Hong Kong businesses, and one that U.S. businesses would face if slack demand and waning consumer confidence persist. Just ask Lau Awok-wah, who recently tried to boost business by slashing prices in her corner grocery store, cutting the cost of a cola to 5 Hong Kong dollars (64 U.S. cents) from 6 Hong Kong dollars (77 cents)--to no avail. ''People are clinging to their wallets,'' Lau grumbled. For almost four years, consumer prices have been dropping in a spiral of deflation that has defied Hong Kong's old belief in constant growth. But they haven't fallen far enough to put residents on a shopping spree, and analysts see the deflation as a sign of economic trouble that has many people scared to spend. ''Hong Kong people are actually very rich, but they just aren't willing to shell out the cash,'' clerk Cathy Cheng observed. July marked Hong Kong's 45th consecutive month of deflation--and no one is sure when it might end. Andy Xie, chief economist at Morgan Stanley Asia Ltd., predicted it could persist for another four or five years. Two economic downturns since the former British colony was handed back to China in 1997 have pushed unemployment to a record 7.8 percent and left many people reluctant to spend. A post-handover collapse in real estate prices is a key culprit. It left many residents with apartments worth less than the balance on their mortgages. With people cutting back on spending for other things, Hong Kong's chances to resume healthy growth are also held back. ''The pie is getting smaller,'' said Ho Lok-sang, head of the Economic Department at Lingnan University. Hong Kong's proximity to mainland China could help keep the deflationary pressures in place for quite some time, Xie said. Thousands of Hong Kong residents travel to the neighboring city of Shenzhen in Guangdong province every day--where they get cut rates for virtually everything. ''Shenzhen will always price themselves lower,'' Xie. Not far from Lau's store in Hong Kong's crowded Wanchai district, door-lock dealer Alex Lai said his small shop is also mired in the deflation blues. ''It used to be if you wanted to renovate your apartment, when you had money, you would devote a lump sum and fix up everything, but now you might want to touch up certain things and not others,'' Lee explained. AP 16 months of deflation keep Japanese economy reeling BY KENJI HALL TOKYO--Deflation is a persistent problem in Japan, too, and a severe economic problem like that in a key U.S. ally is attracting some free advice. A top economic adviser to President Bush said Friday that Japan can reverse deflation and revive its stagnant economy only by quickening reforms. Data last month showed that the Japanese economy shrank for four straight quarters--its worst and longest slump since Tokyo began keeping such records in 1980. R. Glenn Hubbard, chairman of Bush's Council of Economic Advisors, cautioned that the longer Japan waits, the harder it will be to turn around the world's second-largest economy. ''The cost of resolving these problems explodes over time,'' he told reporters. Japan is locked in its third recession in a decade, and deflation--a trend of continuing price declines--has only made matters worse by reducing corporate profits, increasing the burden of paying interest on debts and pushing home values lower. Hubbard, who was visiting Tokyo for talks with economy minister Heizo Takenaka and finance minister Masajuro Shiokawa, said Japan's central bank must take drastic measures to end deflation. Those measures include forcing banks to write off the huge amount of non-performing real estate loans on their books; allowing companies and borrowers to go bankrupt; changing Japan's policy of insuring all savings accounts, even those at insolvent banks, and curtailing public spending, especially on public works projects. AP