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

To: Wyätt Gwyön who wrote (4389)	1/5/2004 9:40:16 AM
From: russwinter	Read Replies (3) \| Respond to of 110194

<daily multi-billion-dollar loss on UST holdings (which the MOF never intends to redeem anyway) is just a rounding error.> Tell that to the people who pay for it. Don't know much about Japanese politics, but would think this mercantilistic wealth transfer to big business at the expense of the Average Joe there could be a political issue?

To: Wyätt Gwyön who wrote (4389)	1/5/2004 10:37:02 AM
From: el_gaviero	Read Replies (1) \| Respond to of 110194

Thanks Darfot for a helpful post. I agree with you that the M of F does not care about loses on its dollar assets. What I don't understand, and would appreciate your thoughts about (or anybody's thoughts about): as Japan creates yen to buy dollars, where are these yen accumulating? Is the Bank of Japan sterilizing them? If not, all these yen must be pooling somewhere. It seems to me at least possible that the situation in Japan is more precarious than we realize. If prices somewhere in the Japanese economy start rising, could not an explosion of inflation take place, as all those pooled yen start flowing to whatever asset or thing that is going up in price?