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 : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (10)	5/1/1998 1:03:00 PM
From: Henry Volquardsen	Read Replies (2) \| Respond to of 3536

I think the Dollar will strengthen against the SE Asian currencies. Moderate strength, not the collapse in these currencies were saw last year. At least for most of them. Part of their strategy is to export their way out of their current difficulties. The US has implicitly signed off on this deal to help them out. You are right that the weakness in the currencies will help them out in this regard. I pointed out in an earlier post that we have already seen significant improvement for some of the tigers. There is also considerable anecdotal evidence about container ships coming to the US being overbooked while ships are returning essentially empty. As an example I had a friend who had some furniture made for his home and has not been able to find space on a ship coming to the US for four months now. Yes the crash also hampers their ability to raise capital. However there is a point at which they stabilize the rate of decline sufficiently and the boom in business activity increases growth rate sufficiently that capital will be reattracted. I believe that is beginning to happen. The problem is that capital will not return in sufficient quantities, even in the above stated circumstances, if there is a fear that this will happen at some point in the future. So the longer term question is will the tigers use this respite to make the structural reform that will make them more attractive for long term capital. Some are and some definitely are not. As far as the US trade deficit, there is no question it will expand. The question is will there be any offset from any growth in exports to Europe as Europe starts to grow again.