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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: Ahda who wrote (3782)	2/28/1999 12:37:00 PM
From: Hawkmoon	Read Replies (2) \| Respond to of 81114

Im not tyring to apply this to progold becuase i am not sure but i am damn sure the currency action is going to start swinging again. Banks' Asia Loan Assets Plunging In Value Darleen, IMO, Japan is the market to watch. They have to devalue their currency to accurately reflect the strength of their economy and financial structure. It seems to me that all of those yen denominated loans they have outstanding will be paid back in currencies that have become stronger in relation to their yen. That is effectively a depreciation of their assets (and why people who are heavily leveraged do better in inflationary times since they pay the loans pack in depreciating currency.). A Yen devaluation will also continue the deflationary trend we are seeing in the US as all of those Japanese autos and TVs we buy from them will become even cheaper. But on the downside, that means even more US jobs going overseas as the US work force is required to compete even more aggressively with foreign labor. And that will lead to calls for tariffs and protectionist legislation from US voters. All of this will make the dollar stronger vis a vis the yen, and quite likely, against gold. For gold to really shine, the dollar must fall from grace and with a 6.1% GDP figure for last quarter, that just isn't going to happen outside a major shock to the financial system here. Regards, Ron