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To: yard_man who wrote (243160)	5/29/2003 10:14:22 PM
From: Secret_Agent_Man	Read Replies (1) \| Respond to of 436258

The repo pool stays full at $39.49 Billion so we see the DOW still levitated. I am gratified that this new metric continues to prove to be accurate as a DOW daily predictor. Recall that this indicator is available at the beginning of the investment day from data published at the Fed's New York website. As the repo pool totals are also used to aid in currency interventions the DOW portion of the hypothesis still remains a work-in-progress. We can't be sure when funds will be switched from DOW support to currency support or whether they will be co-mingled [as I suspect]. Going forward I do not expect the FED to let the DOW fall. Indeed this pugnacious ramming of the indexes upwards is a good indicator of stress at the FED. They seem under great pressure as the Euro continues its rise today, dragging gold up with it. As you have pointed out before at the café the $USD's future appears out of the FED's control despite their Herculean weapons--trading partners are now returning their $800-900 Billion in US currency, exchanging dollars for Euros. This downward trend in the dollar is powerful and not likely to change given the past history of dollar trend reversals. The last such dollar trend reversal happened in 1985 when the MCDI was at 140. It didn't reverse back upwards until 1995 [MCDI=76] and only then after the inauguration of Rubin's "Rescue the Dollar Policy" [AKA Strong Dollar Policy]. There is no such golden rescue in store for today's dollar because the FED and its frail acolytes have already drained the vaults. Sir Eddie George is again staring into his financial "Abyss". Mike Bolser