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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: Don Rohner who wrote (566)	8/9/1998 3:18:00 PM
From: Crimson Ghost	Read Replies (1) \| Respond to of 81102

Don: The expectation that short rates will be going down before long probably is the primary force pushing bond yields lower. But I doubt long yields will drop much more when the Fed actually starts to ease. This will have largely been discounted in advance. And bond yields will start to rebound soon after short rates start drooping, Why? Lower short rates will tend to weaken the dollar. Lower short rates, higher commodities, and an Asian rebound will heighten fears of inflation down the road. I see long bond yields dropping to 5.25%-5.5% by fall, but rebounding to 6%+ by spring. My guess is that European markets will follow Wall Street. Both headed considerably lower before troughing.