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Strategies & Market Trends : Argentine stocks -- Ignore unavailable to you. Want to Upgrade?

To: EPS who wrote (300)	5/27/1999 10:53:00 AM
From: X Y Zebra	Read Replies (1) \| Respond to of 331

What is your take on the stability of the Argentine peso???? If the 1:1 ratio Dollar/peso can survive the coming fire-sale offerings of the elections I would be surprised... I am now thinking that the "powers that be" will utilize this crisis (via the media), to stop the Fed from actually increasing interest rates... however, I do not know exactly who, these powers that be are... <g> (if you do, please let me know, I suspect, the "market bulls" and its advocates, have something to do with it). I personally hope that they dollarize the Argentine economy... it would be a great start to impose a more strict discipline on the politicians, since, as I understand it, they would be limited in what they could do to continue with unsound fiscal policies. The free market would take over, I assume, in the pricing of all assets, therefore, providing with an incentive for enterprises to become more efficient... It is true that without a formal trade agreement, local governments would still have the power to tax import/exports, or would come up with some scheme to penalize the successful enterprises... still a risk. Informally, the entire Latin American region is a sub-state of the US, this step would (to a degree), begin to formalize a "trade agreement" region that eventually, and hopefully, include the entire American continent. If Argentina takes this step, I believe other countries would follow, Brazil, Mexico, Chile, Venezuela... to name the main ones. Looking to the future.... I think that a Latin American/US partnership would be more feasible as a currency block than the Euro, since the American region would be more homogeneous in its character than the European version.... at least there is only two languages to deal with..... (well, may be three... Italian... oops <g>, sorry French... those Quebecoise, and a few, uninhabited islands in the Caribbean !!!) <g> Starting around this post (more or less), there is a discussion on Dollarization.... Message 9772204

To: EPS who wrote (300)	5/28/1999 4:12:00 AM
From: Tom	Respond to of 331

I am up way too early,...contemplating more put options. <g> There certainly is pressure, Victor. The IMF just cut them $1.5 billion worth of slack. That will help. One thing is certain: without a substantial correction on Wall Street something more must be done, else the long suffering begins again for the Argentines. Let Wall Street correct, the dollar weakens, less pressure on the peso. There's no reason to extend the current lunacy, which is exactly what the Fed has been doing. All the Federal Reserve needs to do is stop the credit expansion. It'll come down. People like Mr. Rubin, however, want everyone cut-free from the dollar. And his strong dollar policy certainly keeps the pressure on. East Asian markets took a beating tonight. Long weekend, right? Things could come apart pretty fast, if someone (the Fed) doesn't step-in again today. That's been their pattern -- MWF. Best o' luck, Tom