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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: J.T. who wrote (23365)	2/9/1999 11:13:00 PM
From: IQBAL LATIF	Read Replies (1) \| Respond to of 50167

JT- Notice the rebound in China, Japan holding very well above this pivotal 13800 level, China looks like a good test of old lows..In my opinion present selling would be best thing for AG.. he was concerned about this bubble and most of these stocks are now setting up to become attractive at around 1780 area on NDX- I will purely look at these from that angle as we consolidate in this region of 1180 and 1228-36 area... Presently I see this as a important region, the global markets in my opinion will have some kind of relief to see that we are not across the ocean making a huge 'asset bubble'. It is bursting of bubble that kills markets and nothing else, if P/E 32 is that bubble we are in trouble... However, my view is slightly different one needs to look at PEG to evaluate the P/E realistically. In ASEA at the heart of all this contagion was the huge debt of local companies taken out in foreign currencies, this uneven private sector exchange exposure on lent by willing banks put skids under ASEA. That with passage of time is being resolved, time is the best healer for markets as I always said that markets are sensitive, if they are devoid of these movements, they loose their importance as barometers of nations economy success or failure. Undoubtedly in this process the nations who borrow $ short term funds to finance long-term projects are hurt to the core, on exchange and timing mismatch, the hurt is simply dis-proportionate to the crime they commit. The 'coming back' process is dependent on nation willingness to take harsh austerity decisions, higher productivity and lower appetite of 'who has the largest'!!! syndrome' Mahatir and other's learnt it hard way.. The fact remains that the enemy was within, the extravagance and buying 'growth off the shelf' did them in.. I see some bright side to it, one is that banks have taken the hits hence they are sitting at near all time lows, second the Asean economies has now built in reserves, they have trade surpluses instead of huge current account deficits.. I would think that in absence of any hedge fund bets on currency or markets, I expect these gains to stay and consolidate albeit in process, we can retest most of the supports on HSI and Japan but the fact remains that fundamentally we have a different picture..