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Strategies & Market Trends : JAPAN-Nikkei-Time to go back up? -- Ignore unavailable to you. Want to Upgrade?

To: chirodoc who wrote (1056)	5/28/1998 1:25:00 PM
From: Elmer	Read Replies (1) \| Respond to of 3902

I couldn't agree more. I wouldn't consider buying even partial positions in MBK until its price is close to its book value. I would then buy increasing dollar amounts as it declined toward 50% of book. You said that you can't compare the US banking situation with the Japanese situation. Yes and no. Forbes Magazine published a book last year of interviews of prominent businessmen. Peter Lynch did one of the interviews. He commented on the US market declines in 1987 and 1990 and said that there was a lot more to worry about in 1990. The banking system looked like it was going to fail and Iraq looked like a formidable adversary that might take years and many lives to defeat. It really looked bad. He said that "if there was ever a time to doubt the US future, that was it." Many of these same doubts are reflected in Japanese stock prices. I not saying that Japan's problems won't get worse. I think they will. But I don't think they will go into the next economic "dark ages." That's the question here. Is this economy ever going to come back? I think they will. If one doesn't believe that, investing in Japan makes no sense at all. And if and when the economy comes back, I think their largest and best capitalized bank should do well. In fact, an argument can be made that MBK will benefit long-term from a near collapse in the banking system. That's because a near collapse would take the marginal competitors out of the banking business and allow for higher margins on its business in a recovery. Finally, I think the "other shoe" on the Japanese market will be worsening Indonesian economic problems and China's currency devaluation. That's the point of maximum pessimism in my view. Watch and wait David .