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

To: Oeconomicus who wrote (11)	5/1/1998 3:50:00 PM
From: Henry Volquardsen	Read Replies (1) \| Respond to of 3536

Bob, Don't worry I joke about potential conspiracies as well, particularly when I am losing money. <g> I went home long both US and Europe fixed income last week and when I saw the comments from that journalist Monday morning I was convinced that the Fed was personally out to get me. I do think, btw, they were trying to knock the market of to mitigate a rally on good inflation numbers. The market has always had a tendency to focus on one story at a time. The bigger a market is the more it has a tendency to act like a simple minded beast. Speaking for myself, I know that I have so much info coming at me and need to act so quickly that I have to preplan certain guideposts that I will react to quickly. It's with time an reflection that the market starts to integrate the rest of the story. Notice how the starch dropped out of the bond this afternoon. I started in the business in the late 70s. I remember the markets focus on money supply. The numbers originally were released on Fridays at 4 PM. The whole market would freeze from 10 in the morning on waiting for the numbers (we used to play trivia contests). The Fed decided it was having an adverse effect on the markets so they moved the release time to Thursday afternoon.<G> I worked at Man Han at the time. If you know someone in the markets back then ask them if they remember when Man Han misreported the money supply numbers <GGG>. FWIW I believe the Fed will eventually make a preemptive move. The balance of information coming out does show a mix between steady and tightening so it would not take much to get the Fed to move. I think they are waiting to make sure there is no carry over from Asia. Also let Asia recover a bit so they don't get hit too hard by a tightening. The wild card will be Europe. If the Euro does result in a growth surge I think that will cinch a Fed tightening. Henry