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To: Gabriela Neri who wrote (13933)	6/29/1998 9:35:00 AM
From: Henry Volquardsen	Read Replies (2) \| Respond to of 116769

A bottom in Japanese equities would have a couple of offsetting influence on US equities. Yes if Japan became an attractive investment environment it would attract some money that might otherwise flow to the US. But as an offset, a bottom in Japanese equities would signal a bottom in the Asian economic cycle as well. A return of Asian economic growth would have a carry over globally. I assume your comment regarding excess liquidity was regarding investment flows in the US equity markets. Foreign flows into the US have contributed but are not the main liquidity pump in the US equity market. The biggest pump has been the savings drive by US baby boomers. This is not going to be altered significantly by a bottom in Japanese equities. We have to look at demographics to get a better read on that.

To: Gabriela Neri who wrote (13933)	6/29/1998 10:45:00 AM
From: IngotWeTrust	Read Replies (1) \| Respond to of 116769

Gabriela sez: odds are we dont see collapse but rather a turning around after putting in a final bottom. This would not be good news for the market in the US, as it wld reverse many factors contributing to our excess liquidity conditions. I agree with your first sentence above...but suggest another read on the second conclusion you draw: My read sez: Odds are the "excess liquidity stays right where it is, over here, and in point of fact increases, in my judgment. Altho' I'm aware of the point you are trying to make, I submit the following for your thoughtful consideration: When the Japanese Banks are able to jettison their bad loans to their newly created "Bridge Bank" shortly to be announced after their elections... I submit: their banks will return to lending practices that will continue to feed our monstrous bull market as long as the bull reigns. Why? Well, we DO have the most financially transparent markets on earth, a/w/a we DO have the most stable equity market on earth. I further submit, that if there is a switch, it will be in watching the asset allocation models between bonds/equities and real estate. The closest other market "they" could invest in would be Europe, esp. after 1/1/99. And that one just isn't quite "ripe" yet for massive infusions of capital inflows. Airbus is still second to Boeing for example...And to British Telecom to our Bell Atlantic or LU, etc. O/49r

To: Gabriela Neri who wrote (13933)	6/29/1998 10:58:00 AM
From: Amelia Carhartt	Respond to of 116769

Gabriela: I agree whole heartedly with your observation. I think one of the options Japan has for investment that many don't see is investment in themselves and Asia. I think we are arrogant and somewhat deluded to think that the only place to invest in is America. I don't know if you caught Clinton's town meeting at the University of Beijing last night but it was pretty impressive. What was impressive was that the students were not consumed with human rights issues but with economics. They basically told Clinton when you get your human rights issue straightened out get back to us. In the meantime we'd appreciate it if you'd let us work out our own problems. America, I fear, is very self righteous and naive. This is one contrarian who will be betting very heavily on Japan and Asia when the time is right. I beleive that the day may come when the shoe will be on the other foot so to speak. Susan