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

To: Henry Volquardsen who wrote (1506)	5/13/1999 10:21:00 AM
From: Sam	Read Replies (1) \| Respond to of 3536

Henry, <<A weaker dollar will have an almost immediate impact on their competitiveness and severely crimp their recoveries. The question then would be how deep the correction in US markets had been; very deep and severe psychological damage would probably fold out into a harsher long term correction, a shallow correction and the US markets will probably regain some safe haven status as foreign markets slow.>> I'm not sure what you mean by a "deep" correction. The world needs the US as much as or more than the US needs the world. They can't afford for this country to have such a deep correction that buying power is diminished too much. That will create a nasty spiral. We are the most enthusiastic consumers in the world, a cultural talent that is often publicly derided but implicitly appreciated, and can't be developed by governmental fiat. Even if they "hate" us, they will grit their teeth and send their money here if equity values get too low because they have to. In the end, that may make any correction that may occur wiull be less severe than the one that Japan has experienced since '89. At least, as long as governmental "action" doesn't muck up the equilibriating forces that you so often and eloquently refer to in your wonderful posts to this and other threads. s.

To: Henry Volquardsen who wrote (1506)	5/13/1999 10:39:00 AM
From: David C. Burns	Read Replies (1) \| Respond to of 3536

I've been watching the US bond market with great curiosity. Inflation remains very quiet, real rates of return are high and there is little if any chance for near term FED action yet US bond yields have been rising inexorably. Why? Henry, Do you have a long bond rate forecast, or do you not play that game? David

To: Henry Volquardsen who wrote (1506)	5/13/1999 12:24:00 PM
From: Chip McVickar	Read Replies (1) \| Respond to of 3536

Hello Henry, I hope you're well and enjoying spring green things. Like seasonal cycles we are bound to...man has attempted to qualify and measure anything that looks like a cycle. This fascination has extended into these numerical markets we watch. I've studied them with interest for years from Toynbee, Schumpeter, Wave Theories and Batra. This study...'and cycles' has created a mental oxymoron...an abiding interest and distaste. From this study I can determine 2 Truths [Laws]. 1- Cycles exist 2- When you've found one that works it changes... As an example: Ice out on our lake in NH occurs every year...OKAY April 19th is historically the date of "Ice Out," but it's never exact...it can happen one or two days either side. This year ice left on the 1st.....I lost a $1.00...<<chuckle>> So I agree with you completely I've found as you...cycles are dynamic and fluctuate leaving a trail of memories that approximate the future. I use them as broad filters. >>Anthropology, observation often changes the observed.<< Exactly So...I like that description Dollar I continue to believe that it will take some kind of significant event or a series of events to alter the course that has been set by world economies. The dollar will remain within the recent trading range and there is very little evidence that the dollar will become weaken any time soon. The best chance for this was the last years LTCapital event andcurriency devaluations. These latest trade sanctions of Clinton...is not much more then verbal politics. I understand Europe's distaste for hormone grown beef (I don't eat it myself - only organic) and this could put light pressure on the dollar if trade wars develop with Europe. Bonds >>I've been watching the US bond market with great curiosity. Inflation remains very quiet, real rates of return are high and there is little if any chance for near term FED action yet US bond yields have been rising inexorably. Why? << Wasn't this last jump in bonds from April at 5.4% to May 5.875% just a bounce on expectations about inflation CPI-PPI to be announced this week? Or have you seen significant reduction in overseas purchases? BTW...I'm long the bonds from 118' from yesterday. This is on paper and from technical signals...no cycle studies<<chuckle>> Chip