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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Chip McVickar who wrote (985)	11/2/1998 1:57:00 PM
From: Paul Berliner	Read Replies (2) \| Respond to of 3536

Chip, it would be a smart move if they intervened now instead of later, as I have to believe that the Japanese exporting industry is of more immediate importance to that nation's welfare then the banking system, simply because the exporting industry employs so many more people than the banking system. Sony, Toyota, etc. have always been hedged against a stronger yen to some extent, but the recent violent move left them no time for adjustments to add to the positions. The result will undoubtedly be a rocketing unemployment rate in Japan as exporter profits are punished further and ultimately yield massive layoffs. Here we go again with the overproduction and oversupply issue - who will buy Hitachi's chips now that Intel's and AMD's are suddenly competitively priced, a picture that we have not seen in 2 years? I am sick & tired of reading all this nonsense in the financial press about how Japan has now bottomed and a bargain-hunting we shall go. It's ludicrous. How can an exporting nation be better off when they were already miserable with a 20% weaker currency? Notice the insanity as to how a stock like Hitachi has soared the last few weeks - almost the antithesis as to what one would expect with the stronger yen! This bizarro style of trading must end. I guess if the yen were to go to 200 and Hitachi would enjoy its best results in years the stock would plummet then, right? But a Chmn. resignation and dismal outlook lead to a rally. The bank rally may be warranted upon optimism for the recapitalization plans, but the exporters should be suffering with the stronger yen.

To: Chip McVickar who wrote (985)	11/2/1998 2:08:00 PM
From: Robert Douglas	Read Replies (2) \| Respond to of 3536

Chip, thanks for the link. TOKYO, Nov 2 (Reuters) - U.S. and Japanese financial authorities could intervene to defend the dollar if it slips below 110 yen, as its free-fall could throw the world into deep economic chaos, dealers and analysts in Tokyo say. ''Pressures on the dollar are mounting as no fundamental solutions are in sight for debt problems in Latin America, Russia and China,'' said Shigeo Ichioka, a strategist in the market trading department at Asahi Bank. It seems like only yesterday that we were reading how the “free-falling” yen would throw the world into deep economic chaos. As a matter of fact, I think some of the same reasons for the falling yen are being given now for the falling dollar. To quote Chuck Heston, (quick what movie?) “IT'S A MADHOUSE!!” Personally, I think that often too much is made about moves in currencies. Only a dealer with his eyes strained too closely on his computer screen would characterize the recent move in the dollar as a free-fall. Either that or there is some human need to describe everyday events as “crises”. Next we'll probably be treated to a Euro-crisis or maybe some other currency. -Robert