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To: Alex who wrote (10742)	4/27/1998 7:17:00 AM
From: long-gone	Read Replies (1) \| Respond to of 116764

RE: Euro gold hold stance Alex, Stated on Bloomberg this morning(for what it is worth) gold expected to go higher based on projected gold levels to be held. rh

To: Alex who wrote (10742)	4/27/1998 7:56:00 PM
From: goldsnow	Respond to of 116764

Asia worried over EMU, not ready for own version 03:27 p.m Apr 27, 1998 Eastern By Chizu Nomiyama GENEVA, April 27 (Reuters) - Asian economic experts on Monday expressed worries about the impact of Europe's single currency on their economies, despite assertions from European experts that any pain would be temporary. But speaking at a seminar on the sidelines of the Asian Development Bank's annual meeting, they said it would be unwise for Asia to counter these worries by attempting its own monetary union. Nations joining EMU, due to start in January 1999, should help assuage the fears of those outside the euro bloc by making specific EMU procedures more transparent, they said. ''While those within the area may be satisfied, outside it is raising a lot of questions,'' said Ernest Leung, president of the Philippine Deposit Insurance Corp. ''For those who have obligations in European currencies, what interest rates will be required after EMU?... Will the decisions be unilateral, or will the other party have any say at all?'' Additional economic fears were the last thing needed by the Asian economies, already shaken by the financial crisis that erupted last year, they said. Debate on the economic crisis is firmly set to take centre stage at the ADB's three-day annual meeting, which officially kicks off on Wednesday. ''EMU is not something we take lightly, particularly when we are struggling to overcome the current crisis,'' said Kihwan Kim, ambassador-at-large for economic affairs for South Korea. ''The euro will create a great deal of uncertainty in international monetary relations...Asian nations should express their concerns to the Europeans, sit themselves down and reduce all this uncertainty.'' Officials from some of the soon-to-be EMU member nations said there was no cause for fear. ''The euro will be an untested currency...so initially people may move out of European currencies,'' said Stefan Schonberg, deputy head of the Bundesbank's international relations department. ''But markets do not seem to expect substantial disruptions in foreign exchange and monetary policy.'' They admitted that member nations may suffer at the outset as nations give up control of monetary policy, but added that the pain would only last for the short term. ''It will not be easy. But because of the efforts we have made in the past few years, we should start with good assets. Every country will lose something and there may be tension, but we have the mechanisms to resolve them,'' said Pierre Achard, who represented the French Treasury at the seminar. The Asian nations were more sceptical, saying that while ''core'' EMU countries such as Germany and France needed a loose policy, others with faster growth required higher interest rates. ''The European Central Bank will likely err on the side of safety and aim for price stability. This may keep inflation down, but will sacrifice growth, and what does that mean for the credibility of the euro?'' said Kim. Meanwhile, they said Asia should not attempt a rival single currency of its own, saying economic divergence in the area should be a large enough obstacle and that uniting Asia's leaders would be even more difficult. ''Such is the strength of the political will in Europe, it has overcome the economic fundamentals. This is not the case in Asia and there is much more economic diversity there,'' said Sahoko Kaji, an associate professor at Japan's prestigious Keio University. ''What the Asian nations, including Japan, must do first is regain credibility by stabilising their economies,'' Kaji said. REUTERS

To: Alex who wrote (10742)	4/28/1998 12:40:00 AM
From: PaulM	Respond to of 116764

Not sure I buy the official explanation of today's action. (i.e. WSJ article). 1. The DOW actually held up very well. Given an overrvalued market to begin with, European and Asian markets tanking AND a 30 year bond yield up TWELVE basis points. 2. The real story is the BOND market. Which should scare U.S. denominated asset holders. And which you would expect concerns the plunge protection team more than stocks or gold. Does the potential of a .25 fed funds rate increase really explain the extent of today's shalaking? 3. A clue: despite rates going higher, the dollar fell against the mark. The dollar/mark tide has definitely turned. 4. I think the markets are reacting to competitiion from the Euro. ALready on May 2 the European courrencies are supposed to converge. 5. I think the world's cb's will be preparing for the euro and that means selling that boatload of dollars floating around the world. If the arabs start demanding that oil payments be settled with euro's, that will further lessen the demand for dollars. Years of monetary expansion will catch up with us, seemingly overnight. 6. All this depends on the strength of the euro. Which in turn depends on its gold backing.