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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (24753)	11/25/1997 1:03:00 PM
From: Mike M2	Respond to of 132070

Barry, one point I forgot to make is without the aforementioned extraordinary support for US bonds rates go up. I do not believe SE Asia and Japan are in a position to buy our bonds like they have in the past. Without their buying power rates should go up. With regards to Japan's current holdings there comes a point where one must decide do I want to swallow bitter medicine now or continue throwing good money after bad. No argument from me that sales of bonds by Japan would depress prices I just don't expect them to be able to support there position in US bonds forever. Implicit in the bond bulls argument is the belief that Japan has unlimited resources to support its investment?. If this is true why is the Nikkei down from 38,000 ? Why has the value of their real estate collapsed. The Japanese banks loan losses in SE asia will be staggering. The trouble with the banks is they made loans based on inflated asset values with little regard for the borrowers ability to pay based upon income. Do I own gold? not yet. I will wait for the mkt to tell me when although I might miss an explosive move to the upside. For now I play the short side in a limited way but I am anticipate being 100 % short at some time in the future. Maybe after Wall ST fabled santa Claus rally. I am quite surprised the mkt has suffered so little damage from the collapse in SE Asia. It is only a matter of time before we catch the asian flu. you ask what gets Japan out of its deflationary spiral? time. i do not believe the gov't can avoid the payback for its excesses. Mike