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To: Hank Stamper who wrote (624)	9/1/1998 3:16:00 PM
From: Boca_PETE	Respond to of 15132

David T: RE:<If the Japanese sell, US rates--both long and short-drop> Imho, I'd think Japanese sales of US securities would flood the market with available supply, depress prices and therefore increase (not decrease) long and short rates. If our rates are so high compared to theirs, I'd think they'd be reluctant to sell unless forced to heal their banking system. If our rates rose as a result of their dumping of US securities, more (not) less pressure would be put on the already sinking emerging nation economies that tie their currency and interest rates to the US Dollar. Higher rates here could push the US into recession or worse - not a happy prospect and probably part of what investors have been worrying about these past weeks. Of course a FED reduction in short term rates might somewhat mitigate the adverse impact described above. P

To: Hank Stamper who wrote (624)	9/1/1998 5:30:00 PM
From: Investor2	Read Replies (1) \| Respond to of 15132

RE: "1. US rates--both long and short--drop." Don't you mean rise? Selling pressure => Bond prices drop => interest rates rise? Best wishes, I2