Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Ocote who wrote (8391)	11/17/1997 10:56:00 PM
From: Defrocked	Read Replies (2) \| Respond to of 18056

Great find Ocote! "Under the plan, operators of such pension funds could invest more than 30% of the funds in securities or foreign-currency denominated assets and more than 20% in real estate. The plan will be incorporated into an economic package to be released Tuesday, the sources said. The ministry initially said it would lift the regulations by March 1999, but decided to move the plan up by a year in response to requests from the business community." Free markets at work!<g> I can see the next headline now, "Due to overwhelming support of the business community, especially the banks, the ministry has decided to implement the regulations retroactively"<G> Gotta feel sorry for the pensioner in all this.

To: Ocote who wrote (8391)	11/18/1997 12:07:00 AM
From: Rational	Respond to of 18056

Ocote: Yes, it does. The main unanswered question is whether the pension funds have enough US Treas securities and, if so, whether they will sell those to buy preferred stock. Obviously, the pension funds have invested in (i) stocks, (ii) yen-denominated bonds, and (iii) foreign currency-denominated bonds. Selling (i) will cause a lot of problem to Nikkei and I do not think this will happen. Selling (ii) will cause an excess money supply and inflation, making the Jap bond prices fall (yields rise) and creating a further erosion of Jap bank profits. I see selling (iii) [US Treas] as the best feasible alternative. But, we do not have evidence yet that selling (iii) will take place. Sankar