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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: regli who wrote (24333)	2/25/2005 12:08:11 AM
From: regli	Respond to of 116555

I posted this yesterday on Russ' board. It is a nice indication of some of the difficulties that the Asians face ------------------------------------------------------------ ... The government is clearly in a dilemma about how to tackle the steep appreciation of the local currency. Government officials yesterday reiterated that it is ready to take strong action, if necessary, to stabilize the foreign exchange market. The Ministry of Finance and Economy, however, has little leeway to expand the sale of state bonds to stabilize the mark for the time being. The ministry has recently committed to cut the sale of bonds for the fear that the excessive supply for bonds cause a glut on the bond market. A rapid interest rate has also put a greater burden on the government which relies on the bond market to finance its fiscal policy. The government plans to sell about 3 trillion won ($2.9 billion) worth of treasuries in March, the same as in February. But it's below the monthly average of 5 trillion won. Currency traders said Asian currencies including Korean Won may build up further gains as the United States is expected to let its currency lose ground against other currencies in a bid to narrow its record-high trade deficit. As policymakers' primary concern shifted from won appreciation to a bond market sell-off "aggressive intervention would be difficult under still shaky bond market sentiment," said Oh Suk-tae, an economist at Citigroup Inc., who cut his six-month dollar/won forecast to 970 from 1,025. Despite the plunging won-dollar exchange rate, big enterprises appeared confident of keeping their businesses intact thanks to their risk-management strategies. ... koreaherald.co.kr

To: regli who wrote (24333)	2/25/2005 7:11:57 AM
From: Earlie	Read Replies (2) \| Respond to of 116555

Regli: Good comments. With respect to the global perspective on the US military might,.... that might be changing. It doesn't take rocket science to recognize that the US simply can't afford to maintain its current military strength. Global jurisdictions that might want to see that military "downsized" dramatically, need only cut back on their purchases of US Treasuries and "voila!". And of course, those same jurisdictions have reasons to not just cut back on Treasury purchases but actually sell Treasuries, including a desire to maintain the current (albeit already falling) buying power of their hard-earned "reserves". As the US economy succumbs to the coming "recession", dramatic cutbacks in US military expenditures are inevitable. Russian subs rusting in their pens provide a modern day example of what the future holds. Military hardware is expensive to manufacture, maintain and operate. When you can't afford it (and others won't lend you the dough to keep it), Ebay awaits,.... ("You are bidding on a almost new F-16 aircraft. It has only been flown on Sundays, etc., etc."). Best, Earlie

To: regli who wrote (24333)	2/25/2005 1:10:53 PM
From: Chip McVickar	Read Replies (2) \| Respond to of 116555

regli... Here are 2 interesting technical charts emphasizing particular patterns apparent in the SPX cash Index. Message 21077381 I am aware of your watershed event considerations, but don't agree with the emphasis that you put on the acceleration of the downfall of the US as described in your arguments. We (the public) don't know and don't have enough information to know if the Korean and Russian mishaps are benign policies or aggressive activists in a changing view of the dollar. We do know the world doesn't like this presidents war policies, and we know they don't understand why he was reelected. But that doesn't infer the international monetary system is about to explode against those facts. >>I believe we are observing the early rummaging of these shifts of capital.<< Wouldn't it take a significant shock to the system to really knock out the worlds international financial systems...? But that shock isn't possible to anticipate or know in advance, and over the past 75 years there have been plenty of "whacks." The last of which was the LTCM blowup. (back in the news) I don't Trade or take positions based on Fear... only unbiassed, objective evidence. So... staying fluid... here's some evidence to support your views... and this information can't be ignored. There's a concentrated confirmation coming from astro folks and other technicians, that some event? is on the horizon. Crawford, Granville, Merriman, Mahendra, Hahn, Hitt, Prichter, Eliades, and others are on record calling for a substantive seabed of change due shortly if not immanent within a few weeks. The Big Bears are all Highly Active. (Perhaps they're right...?) But they've been saying this for weeks, if not months and in some cases years. Granville has admitted he was wrong for a solid 10 years... Merriman and Mahendra have excellent track records and Prickter, well he earns his living selling fear and has been wrong for years. Crawford is no better. Using my own stuff... basically trend following systems that have kept me long and adding long positions since March 03, I can say they are NOT negative today. Also, there are internal studies I keep... like ARMS, PCRatios, CLX, etc which have confirmed staying with the systems trend signals. At this time these methods have not broken down....!!! So today, I'd have to say any pull back will be shallow, temporary, and enough to confirm adding long. There is no indication that I should sell. However, the charts as presented show some apparent risks, and the astro folks make me nervous. SFWATIWTY (so for what all this is worth to you) Until that event which irrefutably confirms the international monetary system is significantly destroyed, I'd have to say we'll muddle through. I reserve the right to change my mind next week... <smile> My Best, Chip