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.

Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Jim Ilchyshn who wrote (7051)	2/1/1998 12:32:00 PM
From: Jim Ilchyshn	Read Replies (1) \| Respond to of 116762

More excerpts from WSU... You may recall those days. Japanese industrialists were running around the world. They were snapping up land, factories, ships, prestigious real estate such as the Rockefeller Center and Pebble Beach Golf Club. The Japanese investor had one hallmark. He paid ridiculously absurd prices. The secret was, he didn't care. The Japanese government was giving him free money to make his purchases. Then, if he went broke, the government would cover his losses. He was too big to let fail. And for a long time that's how it worked. Japan was rocking and rolling. They grew their banks, corporations and brokerage firms into the biggest on earth. Pretty heady stuff. You have to wonder how anyone could lose money with vast price subsidies on exports, unlimited money loaned to your customer to buy your products, unlimited capital for your business, guaranteed profits on stock market investments, and the ability to borrow as much free money as you wanted at 0% interest. Everything goes well in a scheme like this, until the Japanese have a domestic crisis and need money at home. Like right now. Then they must repatriate their capital. They must bring all their money home. The yen soars, the dollar tanks and global interest rates shoot to the moon. Finally, the day of reckoning has arrived. Here comes the Grim Reaper. The schemes and projects failed. They are now all under water. The money is gone. From Malaysia to Korea, Asia is broke. The next great depression has already started. In Korea and all through Asia, currencies and stock markets have crashed. They are crashing further by the week. Factories are closing. Executives are committing suicide. Millions and millions are losing their mobs. Food, gold and energy prices are soaring to the moon. The Asians are exporting deflation to the U.S., by sending them cheap goods. They are importing massive inflation: as their currencies fall their oil and other import bills soars. They are importing huge inflation and massive defaults. Korea's biggest creditor is Japan. Japan is booking massive losses, as the Koreans default wholesale. This is really bad news for Japan, and even worse news for the U.S. America is the world's biggest debtor. It's critical right now that you understand this key point: for America to survive with anything close to the comforts and amenities she has grown accustomed to, the world must keep on loaning the U.S. vast amounts of money. They must supply her with vast amounts of cheap imports. And that's the key problem. The world has run out of capital. The huge amount of money Japan loaned Asia has vanished. Global liquidity is vaporizing. Their last pool of desperately needed cash is the stash of a trillion dollars in U.S. government debt the Asians -- namely Japan -- hold. Right now a Korean default seems imminent. That could cause Japan to default. In a global chain reaction, one default leads to another. Please understand, you are not being told how big this global liquidity crisis really is. Asia already is having a 1929 style crash and depression. Businesses are closing. Millions are out of work. Markets have crashed 50% and more. Runs are taking place on banks, and bread lines are forming. Japan is allocating 20 trillion yen -- about $155 billion -- to shore up their bank deposit insurance. That's a drop in the bucket: their losses are in the trillions of dollars. And Standard & Poor's just lowered the debt rating of Sanwa and Sekura -- two of Japan's biggest financial companies. Anyone who thinks the U.S. -- the biggest debtor nation of all -- can somehow avoid all this is crazy. Anyone who believes Japan will wipe out its own economy -- by not cashing in its U.S. government securities -- so America can maintain her bubble market and economy is crazy. The Japanese are not going to let their economy crumble. The world is in a liquidity crisis. Japan will have no choice but to repatriate their money, to prop up their economy. The U.S. chalked up its vast debt buying plastic and chrome toys. The Japanese wracked up their debt creating the mightiest manufacturing society on earth. When this is over and done with, the U.S. will be the biggest loser of all. Makes you think... - Jim.