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

To: Brad Bolen who wrote (23724)	8/9/1998 1:41:00 AM
From: FJV	Read Replies (2) \| Respond to of 94695

Brad, At 146, the Chinese are already in some very quiet devaluation of the yuan. This is evidenced by the movement in the Chinese black market for dollars. At lower levels than 146, Hashimoto and Rubin thought is critical enough to mount a concerted intervention to prop up the yen. Now it seems obvious that Obuchi and his people are taking a hands off approach to the yen, probably taking the tack that the cheap yen will help reflate the economy. Rubin/Greenspan seem to be backing away from any unilateral intervention, believing it inevitable that the yen will fall further. The speculation at the time of the previous intervention was that if the yen were allowed to fall to 150, the Chinese would have no choice but to devalue, thus the emergency move. The political situation has now changed in Japan and the chips will fall where they may. The economic realities of the region, however, have not changed and the Japan-China link is the key to Asia's immediate economic future. I agree that the yen may hit 150 by next week if no intervention is undertaken very soon. The Hang Seng is in a no win situation. If they defend the HK dollar by raising interest rates further, the HS will continue to fall. If they don't defend the currency the peg will fall - real soon. Ten nanoseconds after the peg falls, the yuan will be devalued. JMHO. Tell your mom to sell the property - NOW. Wish I could be more optimistic. Franco