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To: straight life who wrote (16107)	10/7/1998 12:53:00 PM
From: Jeff Vayda	Respond to of 152472

Taichi: IMO, Today's world market conditions approximate the US in 1920's. In the '20s, US capitalism ran amuck. I'll borrow from you cause things will be better tomorrow. Dont have to justify the over capacity or the business plan - everyone is doing well and expects to do even better tomorrow. Same overall amount of money around, just three or four people where using it. Once the house of cards was hit with an ill wind, things began to fall apart. One needed to call in his loan in order to pay off the other who was scared the third might call his loan. Good business and bad all caught up in the same credit squeeze. It took years for the 'economy' to expand enough to absorb the overcapacity and start to grow in real terms. Today the 'new' capitalist markets are feeling the same thing. Supported by years of overly optimistic lending, everyone got to build without true justification. (ex. world's tallest building in Malaysia !) now the cash is not flowing as freely and there is trouble in River City. Not that there is more or less money out there, it is just moving less freely. The question - How long will it take for the 'economy' to absorb the over capacity, hinges on Japan. Being the world's second largest economy, it has the largest amount of ability (pent-up demand) to absorb the world's over capacity. IMO, Jeff Vayda