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

To: Rmn who wrote (12674)	1/2/1998 10:18:00 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 18056

Ramsey, I rarely disagree with Sankar on Asian macroeconomic issues, in this case however, I have stated quite succinctly that the plan will just stretch the time span it will take to write off all these bad loans and thus elongate the period of sub par growth in Japan. I think the plan is wrong, it will not inject additional funds into the economy, only a bold short term bolus of liquidity in the hands of consumers will turn their ship around. There is a need to absorb excess capacity in the far east, if all this absorption is carried out by plant closing rather than byu a combination of write off of excess capacity and increased demand (thus the need for lowering taxes), there is a danger of developing a down spiral in those economies. Since the far east countries' security net is nothing like ours or western Europe a strong possibility of severe contraction in demand and thus a very severe recession going on for more than a year, and engulfing all the rim countries will be difficult to avoid. I say again, LOWER THOSE BLOODY TAXES. I am also on record stating that we will see 140 yen to the dollar before mid year, and the current drop to 132 and thus a breakout for the dollar is according to the "script". Zeev