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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (4887)	6/27/1998 5:10:00 PM
From: Michael Sphar	Read Replies (1) \| Respond to of 9980

Much of the great economic growth that occurred in Japan can be attributed to the US baby boomer society. But the boomers are aging. They may no longer be seeking to buy newer better stereos, tvs, motorcycles and cars with the same impassioned frenzy of the past. They are perceptively shifting focus to longer term financial vehicles to see themselves through their retirement years. It may take longer this time to achieve the export income goals of Japan, Inc, especially in light of this and the fact that another large portion of their export market has devalued its currencies and can no longer afford the products of Japan as easily as in the past.

To: Zeev Hed who wrote (4887)	6/28/1998 1:43:00 PM
From: Worswick	Read Replies (2) \| Respond to of 9980

Zeev thanks so much for the reply. I'd like to hear you address the matter of "credit implosion" or "credit deflation" in addition to your thoughts on "deflation is a result of declining aggregate demand." It seems to me that in Japan and in South East Asia what we have is a substantially impaired credit sector. We have in fact the intimate view of billions of dollars going off to money heaven. In Japan the banks have been calling in their credits right and left according to my Japanese friends. In Malaysia, according to Stitch and Bernie Tate, the banks have absolutely tightened up on lending. How do you create aggregate demand in a deflationary environment.... if there is no liquidity to build the things to sell and to satisfy the demand? At that today, this moment, there are too many things in the market to sell already; and, we are witnessing everyone trying to sell anything they can lay their hands on to create liquidity. The "trap" we are in is that the Asian producers produce and the buyers in the West buy but it is a broken loop. There is no "demand" amongst the producers except to cut their losses. My best to you, Clark