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.

Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (13453)	1/23/1998 6:05:00 PM
From: Defrocked	Read Replies (1) \| Respond to of 94695

Yen carry trade is also suffering from dollar slide providing additional impetus to bond selling. Good short today, GZ, on bonds. Your logic on long gold versus short bonds is also sound. Have a good weekend. Message 3241485

To: GROUND ZERO™ who wrote (13453)	1/23/1998 9:00:00 PM
From: James F. Hopkins	Read Replies (1) \| Respond to of 94695

Gz; A weak or falling dollar hurts U.S. equities as much as anything, it hurts any nations stocks were the currency cant hold it's value, just chart them and look at the stocks dive right after the value of the money does..people pull out currency..then others jump out of the stocks to get out of the currency..and a big down spiral starts and runs untill the carpet baggers think the time is right and move in and buy stuff up for pennies on what it was worth. Our dollar just took a hit, it strated sliding two days ago..and took a good hit today. Very bad sign..the Japanese may sell bonds now..but they get back dollars that are worth less than they were when they bought them, the dollar is being slamed this is the second time in a month. I do expect some bond selling as people who bought bonds back last June..are now ahead of the hot shot equity run up..that has melted down to were thoes big gains the funds made since june are now trailing what the bond buyers got in hand for the same period..bonds never get much attention by the herd but the turtle out runs the rabbit more than some people can think. Take a piece of paper you buy that has interest on it at 7.5% for 30 years. Sell that 9 months later when the new paper only has 5.5% you make the 2% spread compounded for "30 years" in nine months. It's like a dollar that has had it's face value run up in nine mounths around 86%. I used round figures to make it simple, but roughly the june 30 year note has gained about 70%, while new bond prices drop the face value of the old ones go up. The great CNBC Jimmy Rogers who shorted the bond several months ago has lost his clients a ton of money with his enlightened move, he can't cover that short by buying todays bond, he has to cover buying the old ones, or enough additional new ones to make up the differance. The bond market is something he ,in all his daper dan wisdom , seemed not to understand..small percentage moves in interest rates can alter the face value as if you were playing futures. In fact most of the bond market, is a futures game. A lack luster fund such as PPT has gone up over 21% while at the same time paying the owners almost 10% dividends based on what they paid in May/June..this outstips the advance made by the SOXX index in the same time frame, while herds of people jumped into the SOX..as it scremed north as high as 67%..it retrace 48% and is now only holding a 19% gain and the funds in it have had high expence..reducing most of them to about 17% gaines, and they might give up more than that before it's over. Jim