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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: Tiger who wrote (5791)	6/11/1998 2:26:00 AM
From: Jess Beltz	Read Replies (1) \| Respond to of 10921

On the subject of the repayment of loans to Japanese banks by foreign borrowers: I have just talked to Takeshi (my friend) and he believes that the loans are probably yen denominated, since the banks' funding costs (deposits and the interest paid on them) would be yen. However their hedging skills are fairly weak (by Wall Street standards). What that means for right now is that Japanese banks may not face as much currency risk (with respect to debt repayment) as I had imagined. However, if the slide in the yen means the depression of the regional economies, the ability of foreign firms to service their debt obligations to Japanese banks may still be impaired simply because of the shrinkage of the revenue stream due to the domestic economic downturn. The more you look at it, the more it looks like a no-win situation for them. Takeshi is doing an interview for a local TV station (on the Japanese economy - a huge topic here) and in doing his research for the interview will follow up on the question of how these loans are made. jess.