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To: Mohan Marette who wrote (64343)	9/9/1998 11:47:00 AM
From: Lee	Read Replies (1) \| Respond to of 176387

Hi Mohan,..Re:I hear there is a school of thought among economists out there who thinks in this day and age the importance of Central Banks have been diminished somewhat as they think the market place is more in control than the these folks. There was a big discussion of this on TSC several months back but I don't remember the consensus opinion. In my opinion, the Central Banks will be necessary if you consider what has happened in some countries recently without a strong Central Bank. I'm thinking about Russia here but there are many additional problems there as well. Sometimes, I've also noticed that the bonds lead the Fed, but for the most part, the Fed has been pretty accurate in anticipating future expansion or contraction. Also, without a Central Bank, think what hedge funds could do if they organized to move a market. <VBG> I have no idea why Japan lowered their rate another 25 basis points, especially in light of all the crying about the weak yen. Doesn't make any sense anyway does it? I mean talk about cheap money! It might be cheap money but lending restrictions are so tight that it's apparently not that easy to get loans anyway. This is the whole problem from my understanding. It seems to have undone the affects of AG's speech Friday evening in CA which benefited the yen and other emerging market currencies. Best, Lee

To: Mohan Marette who wrote (64343)	9/9/1998 12:02:00 PM
From: Lee	Respond to of 176387

Hi Mohan,..Re: Japanese rate cut- any thoughts on this as to the possible implications? Tony Crescendi of Miller Tabek and Hirsch was just on CNBC saying that the rate cut by Japan was a desperation measure undertaken to put more liquidity in the market. In other words, they are not taking the necessary tough path of bank reform but instead trying to achieve demand through easy money. That's also why bonds are up today since it was a big disappointment and money is returning here as 'flight to quality' funds. Makes good sense. Too bad. Just more of the same ----- forever? Best, Lee