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

To: maceng2 who wrote (25353)	11/12/2002 11:28:13 AM
From: GUSTAVE JAEGER	Respond to of 74559

Re: "Firstly, it raises expectations the ECB will cut by at least 25 basis points if not 50 at its December meeting.... Indeed the ECB's in a jam: it can't trim its interest rate because that's the last bargaining chip the ECB has to sustain the euro... As I pointed out in my previous post, the euro has already no value as a trade currency --so, what are we left with? The only incentive to buy euros is its reserve value --like gold... But then, even gold is more attractive than the euro... because gold is priced in... dollars! Anyway, sooner or later, that USD/EUR peg will become unsustainable... After all, that's why the EU's junior members (benelux) were so angry about the breach in the so-called Stability Pact: if France, Germany and Italy don't care about deficits and public spending then.... the whole of Europe might soon have to pay 2 euros for one greenback. Gus