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To: engineer who wrote (20862)	1/6/1999 1:20:00 AM
From: Jon Koplik	Read Replies (1) \| Respond to of 152472

Basic macro-economics does work -- if the Yen stays unrealistically strong for a while, it will kill Japanese exports, and then force the Yen down. Jon.

To: engineer who wrote (20862)	1/6/1999 8:14:00 AM
From: Keith Feral	Read Replies (1) \| Respond to of 152472

engineer: The Japanese are boosting their currency by making interest rates more attractive. Japan just had a major rate increase last week to 2.9%, an increase of 0.7%. Suffice to say, a higher level of interest rates makes the domestic currency more attractive on a forex model vs. other currencies. I saw figures last week that the Korean market was up over 100% since the October lows.

To: engineer who wrote (20862)	1/6/1999 11:30:00 AM
From: Clarksterh	Read Replies (2) \| Respond to of 152472

Engineer - I was very confused this morning when they said on CNBC that the Yen had hit close to 100 per dollar. If the economy is so bad there, how can they still afford to prop up this currency this way? I know in Korea, they hit the companies pretty hard with the IMF stepping in. Isn't the IMF involved in Japan? Nothing like some good amateur (me) commentary, but the problem in Japan is not exactly the same as in Korea at al. In Korea they had two separate problems - a bubble and foreign debt denominated in foreign currency. Thus, when the bubble collapsed it was more severe than the problem in Japan since Japan had only a bubble problem. Also, Japan, as a debt free nation, has less reason to take advice from outsiders. The IMF really doesn't have any leverage with Japan since they don't have anything that the Japanese need. As for why they should be raising interest rates and thus boosting their currency in the midst of a recession, I can think of no reason why this is a good idea. Who knows what they are thinking? Clark