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Non-Tech : Derivatives: Darth Vader's Revenge -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (360)	10/5/1998 9:42:00 AM
From: Henry Volquardsen	Read Replies (1) \| Respond to of 2794

Bobby, I am not sure what the total bank exposure to derivatives trading is but you have to remember it is more important what the type of derivatives are, the amount of leverage and the credit quality of their counterparts. As far as the prospects of a tax cut I have to agree with Greenspan. My overwhelming preference is for no tax cut and to run the surplus to pay down the deficit. But I also agree with Greenspan that if there is no political will to maintain the surplus I would prefer tax cuts, even cuts that don't go to my income bracket, to new spending. And on that measure the President's efforts to stand firm on saving social security is pr hype. The Republicans have proposed $80 bln in tax cuts over 5 years with the rest of the surplus going to social security. The president has proposed over $25 bln in 'emergency' spending for the coming year and undoubtedly more in the following years. So my preference is for neither package but if one has to take one of the two, the Republicans appear to leave more for social security. Henry