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

To: TobagoJack who wrote (61348)	3/30/2005 12:30:51 AM
From: pezz	Read Replies (1) \| Respond to of 74559

Today's report sold the rest of TCOW @ .96 and bought a coupla trenches of MS @ 3.41 .... Looks like ya havin lotsa fun spoilin that child %^)

To: TobagoJack who wrote (61348)	3/30/2005 2:03:39 AM
From: Taikun	Read Replies (1) \| Respond to of 74559

Jay, Your little one looks like a better swimmer than me! By the way, how will Japan survive keeping bond yield so low? The carry trade will contine strong once the T-Bill yield is up to 4.75%. The Japanese save money because the interest rate is too low, so companies have too low a target in generating returns. America waves these paper returns at Japan, and they bite. As long as America is willing to bully N. Korea, Iran, the pirce is cheap. Imagine if the US didn't sepdn $400 billion/yr on defense. These other countries would have to pay individually. Firstly, they are unorganized (forget the UN) and secondly they don't have economies of scale like the US. Imagine for a moment that $400 billion keeps the trade routes open. It keeps oil flowing. 30 billion barrels of oil were consumed worldwide last year. Maybe part of the increase in the oil price is this 'security fee', levied via USD, but rolled into oil. In reality, the security fee is rolled into many items, including Asian exports. One big reason for the larger US deficit is the extra defense spending, in a less secure world. Japan's low interest rates at home keep the game going. D Fukui Says Gains in Bond Yields Should Reflect Japan's Economy March 23 (Bloomberg) -- The Bank of Japan doesn't want increases in bond yields that aren't underpinned by the performance of the economy, Governor Toshihiko Fukui said. ``We want to avoid, as much as possible, interest rates from being decided in a manner that fails to match the state of the economy,'' Fukui told the budget committee of the upper house of parliament in Tokyo today. He added that central banks can't directly influence long- term interest rates. Government efforts to curb bond sales are ``crucial'' to keeping yields in check, he said. The yield on the 1.5 percent bond due March 2015 fell 1.5 basis points to 1.405 percent as of as of 4:06 p.m. in Tokyo, according to Japan Bond Trading Co., the nation's largest debt broker. A basis point is 0.01 percentage point. Fukui repeated that the central bank is committed to maintaining the policy of pumping cash into the economy and holding interest rates at almost zero until core consumer prices stop falling and policy makers are sure they won't resume declining. Core prices, which exclude fresh food, are not the only factor to determine the bank's policy, he said. The bank needs an ``overall judgment'' of the economy before shifting policy. If the central bank decides to change policy and needs to absorb liquidity from the money market, it will try to sell a wide range of assets, he said. ``I think we can absorb liquidity by selling various assets on our balance sheet in a well-balanced manner,'' he said. To contact the reporter on this story: Mayumi Otsuma in Tokyo at motsuma@bloomberg.net To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net Last Updated: March 23, 2005 02:20 EST bloomberg.com