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Gold/Mining/Energy : At a bottom now for gold? -- Ignore unavailable to you. Want to Upgrade?

To: Ahda who wrote (1184)	6/21/1998 1:10:00 AM
From: ahhaha	Read Replies (2) \| Respond to of 1911

The currency is backed by gold. The government doesn't convert your currency at the gold window as it once did, you can convert currency to all forms by buying gold stocks, coins, bullion, from various sources. So what do you mean by backed? As for Japan I've detailed my recommendations elsewhere at length. Suffice it to say the only problem they have is that they are being eaten alive by competitive tigers. As long as the big influx of foreign currency came in from trade, the real estate shell game could be smoke screened. They can't expect that any more. It is a major error on just about everyone's part that bad loans have some consequence on the only thing that matters: competitive position. The world is now a global community and so the prosperity of nations depends upon how efficient their peoples elect to be. Bad loans are a domestic issue and don't impede the willingness of people to produce. They don't even impede the willingness to expand business. The yen is falling in international markets against other currencies. That doesn't effect the price of domestic generated goods in Japan. To make Japan more efficient requires corporate tax cuts and monetary policy that doesn't hide in neo-mercantilism or hide from ghosts of bad debts. I'm sure there are plenty of wags out there who would claim foreigners hold much of these bad loans. They would have to make that claim if the falling yen is a consequence of foreign loan liquidation. A foreign loan holder would sell the loan at a substantial discount and be paid in yen. Then the yen would be dumped on the open market. But that isn't what has been going on. The selling has been thin and persistent which indicates that the buyers have no confidence in Japan. No confidence in what of Japan? No confidence in the way Japan is running its economy? Yes, but no confidence in the way Japan is running its economy to retain its efficiency, not because it got carried away with its wealth and bid up real estate. If the latter was true, then why did the yen double from '93 to July '95? Wasn't the loan issue operational then? The loan issue is irrelevant and the yen has fallen since '95 because China in particular has come on stream big time. I've noticed that in the past most stuff I bought came from Japan, but in the last couple of years it is all coming from China Taiwan, and Korea. I might add that the US doesn't want the yen to rise. The BOJ doesn't want it to rise. Summers and Rubin want it to continue to slowly fall so that China doesn't devalue the yuan and because our costs of doing business are held down. The competitiveness of Asia also keeps our labor from demanding inflationary compensation. Eventually even a slowly falling yen would force China to lower the yuan. That's tomorrow's big deal international crisis tempest in a teapot. If we provide valuable services, others are dependent upon us. Valuable is a function of cost. We must keep our prices down. We earn more when we do that. I know it's hard to understand that, but if you want to succeed in business, it's the cutting edge and it is alien to most American corporations. I don't blame them so much, they're stuck with monopoly unions. Diplomacy works only when differing parties recognize mutual interests. The best interest for all nations is not to be diplomatic about trade. No nations does or should pursue the interests of another. This world doesn't run on pabulum idealism served up by universities. So our leaders shouldn't be over in Japan telling them how to run their economy. If I were them, I sure wouldn't trust an incompetent like Summers. He is a believer in the Democrat Party's approach to international relations. They draw a line. They tell the adversary that to cross the line means a response. The adversary crosses the line. No response, but to draw another line and say that to cross the second line guarantees a response. They keep doing this until our back is against the wall. Then in desperation they lash out with nuclear weapons. Liberal diplomacy. Taking care of the other guy. Looking out for someone else's interest. It's so caring.