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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: William H Huebl who wrote (31141)	10/10/1998 1:57:00 PM
From: GROUND ZERO™	Read Replies (1) \| Respond to of 94695

Bill, You were right, last week ended up on the plus side. The only thing that counts here is the bottom line. Enjoy. GZ

To: William H Huebl who wrote (31141)	10/10/1998 1:57:00 PM
From: GROUND ZERO™	Read Replies (1) \| Respond to of 94695

Bill, You were right, last week ended up on the plus side. From one technician to another, you can change your mind as many times as your indicators tell you to, the only thing that counts here is the bottom line. Enjoy. GZ

To: William H Huebl who wrote (31141)	10/10/1998 5:36:00 PM
From: D & G	Read Replies (1) \| Respond to of 94695

Bill, like your put call on PG. I picked up some puts at the close friday, but started to second guess myself. Nice to know I might have some company. DJF

To: William H Huebl who wrote (31141)	10/10/1998 8:23:00 PM
From: flickerful	Read Replies (2) \| Respond to of 94695

Bond prices hit in flight to cash ft/10 oct 98 By Jeremy Grant in London Global bond markets succumbed to savage bouts of selling yesterday as investors shrank from anything that smacked of risk and sought the safest of havens - cash. Prices fell sharply as hedge funds unwound their positions in the bond markets, ending a sustained bond rally that has coincided with turmoil in emerging markets. The slide in bonds with longer maturities followed the dramatic fall in the US dollar against the Japanese yen on Wednesday and Thursday, which shook investor confidence. The dollar steadied yesterday at around ¥117, compared with more than ¥130 at the beginning of the week. Fears of a possible credit crunch and jitters about the health of banks have prompted nervous investors to try to liquidate long-term assets. But an acute lack of liquidity meant that most were unable to do so yesterday, with price movements exaggerated by the few large trades that made it through. "I've never seen anything like this before," said Neil Parker, treasury economist at Royal Bank of Scotland. "The worry is that the hedge funds and Japanese [investors] are getting out, but no one wants to trade bonds because they're whipping about all over the place." The yield on the benchmark 30-year US Treasury bond jumped to 5.13 per cent in morning trade in New York, compared with lows of 4.70 per cent earlier in the week. Yields rise when bond prices are weak. Traders said there was a dramatic shift away from longer-dated bonds and towards short-dated stock, which typically offers a return closer to that of cash. Sharp reversals were also seen in Europe. The benchmark UK government bond future was down 4.24 points at one stage, ending the day 2.69 points lower at 113.65. Italy, Europe's largest bond market, received a double blow as the government of Romano Prodi narrowly lost a confidence vote. Only a week ago, investment in high-quality government bonds was considered protection against a significant downturn in the global economy and nervousness in equity markets. But in the space of about 48 hours, that image has been punctured. Investors, increasingly concerned about the global financial crisis, have become extremely risk-averse and banks are trimming credit lines. The risk that credit lines may be cut means it is becoming harder for companies to finance projects and many are realising their investments - including bond positions they may have held for some time. Hedge funds are also desperate to offload bond holdings to cover losses in emerging markets, unwind currency holdings and repay loans raised to speculate in the markets. "It's not really an issue of loss of security [of bonds]," said Rob Minikin, currency strategist at Citibank. "The people that hold them are financed by borrowing from the banking system and they require this oxygen to keep their positions alive. That has been withdrawn and they're gasping for breath." Yesterday's performance in the bond market appeared to confirm that capital flows, not fundamentals, are now driving even the bond markets - a point that Alan Greenspan, US Federal Reserve chairman, drove home this week when he spoke of "a broad area of uncertainty or fear". In a speech on Wednesday to the National Association for Business Economics, he said investors were increasingly avoiding risk and choosing the most liquid assets available. "A major shift towards liquidity protection is really not a market phenomenon. It's ...a fear- induced psychological response," Mr Greenspan said. Equity prices increased in Europe yesterday, supported by modest gains on Wall Street and the steadier dollar.