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To: Defrocked who wrote (2428)	6/19/1998 4:58:00 PM
From: Joseph G.	Read Replies (1) \| Respond to of 86076

<<But China is also sure to encounter serious setbacks as it races headlong into the future. One huge problem it faces is its Asian neighbors--who compete with it in world markets and whose currencies and cost structures have recently dropped by 50 to 80 percent. I predict that this new competitive pressure will produce some kind of turmoil in China. Whether it will be a currency devaluation or political upheaval, I can't say. What I do know is that history shows that nations undergoing such wrenching change rarely do so smoothly. Problems are inevitable, and the next big problem in China is going to be my buy signal. When I see on the front page of a respectable Western newspaper that there is turmoil in China, that's when I'll start buying Asia again. By then, Asian markets should be below even the low levels they're at now. This should be the true bottom.>> Emphasis added.

To: Defrocked who wrote (2428)	6/19/1998 7:18:00 PM
From: Joseph G.	Read Replies (2) \| Respond to of 86076

The basic problem seems to be production overcapacity compared to what is needed for consumption, in particular, there is not enough markets to sell into for both Japan and PRC (and also throw in Korea et al). Strengthening yen helps China but hurts Japan, helping Japan hurts China. US is consumer of last resort, but it also wants to raise its own productivity and to close the export gap. Same goes for W.Europe. A situation reminiscent of 1929 - 33. What gives?