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Strategies & Market Trends : HONG KONG -- Ignore unavailable to you. Want to Upgrade?

To: Ron Bower who wrote (2211)	8/31/1998 10:48:00 AM
From: Tom	Read Replies (1) \| Respond to of 2951

Ron, "...US banks have large Russian exposure and very little in China. Investment versus loans?" My cynical response has to be that they were told Russian exposure is "covered", China exposure is not. In other words, Russian losses would be covered by some sort of bailout. What grates on me, and what I'd like to see revealed, is what business U.S. banks are conducting off the books. Should the "waterfall effect" hit the U.S. equity indices, there may be more of a revelation than anyone currently imagines. I think that will also hit the USD and relieve a bit of pressure on the East Asian currencies. I wonder how low U.S. markets must venture before Moody's does a little downgrading of domestic banks? By the way, current circumstances tell me the FOMC isn't thinking about a rate cut. I have, however, read a cogent argument that involves an easing of lending rates followed some months later by very aggressive tightening. An interesting week ahead of us.