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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (3039)	12/9/2003 1:03:51 PM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 110194

yes but it's only several percent above where it debuted. if it could fall 30% below its debut price, then it could rise 30% above the same, to around 150.

To: Haim R. Branisteanu who wrote (3039)	12/9/2003 3:18:29 PM
From: MulhollandDrive	Read Replies (2) \| Respond to of 110194

goodness, if the incentive to "move" was strong with euro considered "high" back in may, imagine the pressure there is today :) catiaworld.com For now, Germans are protected from impact of strong euro: By: Jesse Snyder: Automotive News Published_Date: May 19, 2003 Comments The strength of the euro against the US dollar is tilting against export-oriented German premium carmakers. The euro has appreciated 25 percent against the dollar since January 2002. Historically, an exporter shipping from a weak-currency side has an advantage in strong-currency markets, and can undercut rivals' prices. But strong-currency exporters must cut margins - or raise prices and lose sales. A consistently strong dollar over the past decade has helped European luxury automakers build a strong presence in North America. But these days, carmakers have learned how to cope with short-term exchange rate volatility. Tactically, they hedge, buying currency-rate financial futures that offset rate fluctuations. Strategically, most mass-market automakers and suppliers produce where they sell. Global exporters seek so-called natural hedging - balancing production and sales so exports and imports roughly balance out. The question is how long the situation will last. Many currency traders say US economic fundamentals - slow growth, big trade deficits and growing government debt - work against a stronger dollar. Most affected are German companies such as BMW, DaimlerChrysler, Porsche and Volkswagen group. General Motors and Ford mostly build where they sell except for their luxury Swedish and British brands, which are outside the eurozone. Tactically, the Germans are largely covered. VW group was only 40 percent hedged, and the euro's strength helped drive first-quarter pre-tax profits down 66.8 percent to by E331 million. But BMW, Porsche and D/C are completely hedged. "Porsche nearly went bust in the 1980s. It relied on the USA but wasn't hedged," said Porsche spokesman Immo Dehnert. "Now we have hedged our dollar positions almost 100 percent for the next four years." But long-term hedging is costly. One solution is to shift production to weaker currency areas. BMW and D/C already have US plants and have encouraged suppliers to follow. Saab plans to add models built by other GM affiliates in Japan and the USA. The incentive to move is strong

To: Haim R. Branisteanu who wrote (3039)	12/10/2003 4:08:17 AM
From: zonder	Read Replies (1) \| Respond to of 110194

That is not an answer to my question, though. You said "it is generally accepted that EZ exports drop around 1% for each 1% rise in the EUR/USD level." Now, I don't know who your source is for this "generally accepted" pearl of wisdom, but I am asking you a question: How do you explain the fact that Eurozone economy expanded for the first time in a year in the third quarter, led by a 2.2% surge in exports? In the 3rd quarter the EUR average was around 1.12 or so. September 1, EUR below 1.08, August below 1.14, July 1.15+. Now we are at 1.2220 or 9%+ higher I would like to believe that you in fact realize Eurozone grew in 3Q2003 compared with a year ago, when EUR/USD average was close to parity - i.e. significantly below the levels of the past couple of months. So... Answer the question. Please :-)