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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: HammerHead who wrote (23661)	8/8/1998 2:31:00 AM
From: FJV	Read Replies (1) \| Respond to of 94695

If the Chinese devalue now, we will be in for a nasty worldwide recession and one of the 2 or 3 worst bear markets of the century. Let's hope the speculation doesn't come to pass. The key will be the value of the yen. If the yen falls to 150 to the $, the Chinese will have choice but to devalue in order to defend itself. Also, under those circumstances, HK will lose its peg to the $ as well. The Hang Seng will accelerate its decline, the rest of Asia will be in the sh** house and so it goes. Sorry for the pessimistic view. Franco

To: HammerHead who wrote (23661)	8/8/1998 6:05:00 AM
From: Philipp	Respond to of 94695

Reg.: Chinese devaluation If the Chinese devalue under the present weak market conditions, that would undoubtedly cause a crash of Asian and Western markets. But I doubt that this is imminent. They will do (are doing?) a devaluation by stealth (for example, by more and more using blackmarket rates even for official transactions, hedging, discounting). Outlook for Monday I think that the key question for Monday/Tuesday is whether we will get a "last-gasp" rally (David Plonk) or not, but I doubt that anyone really knows after Friday's actions. There was some real strength in the Nasdaq and Russell, but the afternoon sell-off was ominous. It seems to me that there are now more sell-the-rallies players than buy-the-dips players. I doubt that the Nasdaq and Russell alone will be strong enough to generate a major rally in the main indices. It probably requires some major positive news, but I don't know what that could be (I can think of lots of bad news over the weekend). One should probably watch the talking heads in the weekend business programs and the commentaries in the financial part of major (non-business) newspapers. If they are unanimous that the worst is over, expect a rally, if there is too much crash talk, we'll skip the rally, if it is mixed, good luck! Neutral for the moment. Good trading, Phil

To: HammerHead who wrote (23661)	8/8/1998 10:54:00 PM
From: N	Read Replies (3) \| Respond to of 94695

From the South China Morning Post scmp.com Only half joking, Goldman Sachs to the rescue again? There are regular articles on currency and markets here too. Would like to watch this more. Does anyone have better sites for Asian financial news? August 8, 1998 Economy Goldman Sachs backs optimism in Beijing RENEE LAI Investment bank Goldman Sachs has cast a vote of confidence in Beijing's promise not to devalue the yuan, forecasting that the currency will remain stable over the next 12 months. Asia economic research executive director Fred Hu Zhuliu said worries of a potential devaluation were "unfounded". He said the continued healthy expansion of the mainland economy, driven by domestic demand, would allow Beijing to uphold the yuan exchange rate. Mr Hu has marked down slightly his forecast for gross domestic product (GDP) growth this year to 7.6 per cent from 8.2 per cent, with a net impact of a downward revision of private-consumption and import growth and an upgrade of fixed-investment growth. He lowered the forecast for private-consumption growth to 4 per cent from 7.3 per cent and halved the import-growth projection to 5 per cent. His estimate of fixed-investment growth was raised to 13.5 per cent from 12.5 per cent. He maintained his forecast for this year's export growth at 5 per cent in US-dollar terms. .... And from the Financial Times ASIA-PACIFIC: Hong Kong pushed lower by currency fears Battered by currency fears, HONG KONG extended its decline this week to 11.6 per cent, with the benchmark Hang Seng index ending off a further 235.95 at 7,018.41, down 3.3 per cent on the day. Worries about the economy following this week's news of a 2.8 per cent contraction in first-quarter output spilled over viciously into the foreign exchanges, sending money markets rates steeply higher. "Devaluation is firmly back on traders' agendas, but most people think it's a scare story rather than a real threat," said one broker. However, three-month inter-bank rates ended the day at 12.75 per cent. It proved a powerful signal for the sellers of equities. Market heavyweight HSBC fell HK$6.50 to HK$161.50 for a decline on the week of almost 14 per cent. The redchip index lost 3.1 per cent and H shares came off 2.6 per cent. The Hang Seng is now well below half its level of year ago. The market peaked at 16,820.31 on August 7 in the wake of the buying spree that followed the handover of Hong Kong to China.