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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: IQBAL LATIF who wrote (19983)	9/5/1998 6:02:00 AM
From: flickerful	Read Replies (1) \| Respond to of 50167

Japan must use public funds to help banks-Rubin SAN FRANCISCO, Sept 4 (Reuters) - U.S. Treasury Secretary Robert Rubin urged Japan on Friday to move quickly to shore up its weak banking sector and boost domestic demand, saying the entire world was expecting Tokyo to take swift action. ''I emphasized the importance of implementing strong actions to strengthen the banking system and restore confidence,'' Rubin told a news briefing after a 90-minute closed-door meeting with his Japanese counterpart Kiichi Miyazawa. ''This requires, in our view, using sufficient public funds aggressively and appropriately to strengthen weak but viable banks, accompanied by an accelerated disclosure of troubled assets, improved financial disclosure, and a strengthening of ...the regulatory structure,'' he added. He noted that economic policies and performance in both the United States and Japan, the world's two largest economies, were of ''enormous importance to the rest of the world.'' ''It is urgent that Japan acts quickly to implement fiscal measures that provide...substantial and sustained stimulus to the Japanese economy,'' he said. ''Japan is one of the great economic success stories of the past 50 years,'' he continued. ''The world needs Japan to rise to the economic challenge.'' Rubin reiterated it was crucial that the U.S. Congress approves the administration's request to provide some $18 billion in extra funding for the International Monetary Fund to help guard against future economic crisis in the world that could adversely affect the United States. ''I still think that the probability of a major crisis that can have an effect on the United States is low...but not non-existent,'' he said. Rubin repeated his forecast that he expected the U.S. economy to continue on a path of ''solid growth and low inflation''.

To: IQBAL LATIF who wrote (19983)	9/5/1998 6:52:00 PM
From: James Strauss	Read Replies (4) \| Respond to of 50167

Ike: The FED should cut rates... But not because inflation concerns have eased... Rates need to be cut to lower the value of the dollar around the world, especially with an Eye towards Japan, Latin America and Russia... If rates are cut it will be more of a political decision than monetary decision... As for the timing of the rate cut, it's about four to six months too late... Worldwide economies are hurting... It normally takes six to nine months for a rate change to work its way through the economy... So, what we have here is an attempt to buoy the U.S. markets... Unfortunately, history shows that band aid fixes only have temporary effects on the markets... It's the health of the economy that really moves the market... With earnings projections being lowered in the coming Qtrs a recession seems likely and cannot be postponed indefinitely by artificial monetary manipulations... Any artificial bounce the market may make will make the inevitable fall that much harder... Jim