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Technology Stocks : Y2K (Year 2000): Is Wall Street & Banking Vulnerable? -- Ignore unavailable to you. Want to Upgrade?

To: C.K. Houston who wrote (32)	5/31/1999 10:37:00 PM
From: C.K. Houston	Respond to of 158

A Special Financial Report: The other year 2000 problem The world's largest financial institution is facing a ticking timebomb. The largest financial institution in the world is the Japanese Postal Savings System. It was created in the mid 1960's as a convenient and safe system for "ordinary people" to invest in time deposits. In return, the government benefited from the steady cash deposits ... In 1990, the Postal Savings was offering compounded annual yields of over 8.5% on ten-year deposits. Japanese "ordinary people" poured about $1trillion into the system. They subsequently withdrew about 40%, but the remaining balance with interest will come to maturity in 2000. Starting in 2000, people will be lining up at post offices to redeem their 10-year bonds. Since rolling over into new fixed-rate Postal Savings deposits will yield only about 0.2% interest, I expect most will want to put their money elsewhere. How much are we talking about here? Well, we're talking about an Alan Greenspan amount of money...about $1 trillion dollars. $1 trillion is about the same as the GDP's of Canada and Mexico combined ... I have never been able to visualize a scenario that would prompt Japan to sell it's massive holdings of U.S. Treasury Bills. I'm starting to see a scenario now. www2.gol.com Global Online - Japan Do you remember when Dr. Sakakibara, affectionately called 'Mr. Yen' for his ability to alter markets with a single comment, said last year that no more Japanese financial institutions would fail? (Two more failed within a month...) Well, in case you didn't hear, another bank failed last week. I think Dr. Sakakibara could be considered to be an optimist. This is what he told The Australian Financial Review in an interview in Tokyo last week: "The US, right now, is the centre of global capitalism, and if the centre collapses, the world system could collapse. And the situation in the US is not sustainable." He said that while last year's international crisis had passed, deep structural flaws remained in the world capitalist system. And he said that the US economy had some worrying elements, including "a bubble aspect", a lack of domestic savings, and a sharp run-up in international indebtedness. These flaws in the system and the vulnerability of the US economy could come together to bring about a collapse in the system of global capitalism. www2.gol.com Interesting site. Cheryl How to say Y2K in Japanese www2.gol.com