[PEN-L:490] Re: Financial breakdown in Japan

[Rosser Jr, John Barkley]

     Hey, the Japanese have a huge trade surplus and are 
the world's largest net creditor nation.  The US, on the 
other hand, has a huge and rising trade deficit and is the 
world's largest net debtor nation and is now in a falling 
interest rate scene. Plain old forex fundamentals suggest 
such a movement. What is not suggested, and reflects the 
new situation, is the speed of the movement.  We've gotten 
so used to the idea that forex markets ignore fundamentals 
that we get shocked when they suddenly pay attention to 
them.
Barkley Rosser
On Sat, 10 Oct 1998 21:22:10 +1000 Rob Schaap 
<[EMAIL PROTECTED]> wrote:

> G'day again, Penners!
> 
> So how did the Yen do that Phoenix thing?  Japan has perhaps the worst
> excess capacity problem in the world; its tax receipt projections must be
> hair-raising; we still don't know who owes whom what, nor what the odds are
> on those debts being honoured (better under a stronger yen?); we're left
> asking whether an America-on-the-edge is the only way to avoid Japan going
> right over the edge; and I guess Japanese domestic sales only suffer more
> while this unaccountably butch yen sucks in Korean goodies.
> 
> And did those whopping hedge funds protect themnselves against these even
> more whopping fluctuations?  If so, do we discover the answer only if and
> when they come bleating to the Fed?  If a few turn up on the doorstep at
> the same time, what then?
> 
> Still, I suppose it means somebody is in a position to buy Australian
> commodities for a while.  Somebody must think so, because our currency,
> which represents a predominantly commodity economy in a time when commodity
> producers are madly trying to sell themselves out of oblivion, went up 4
> cents against the greenback on Thursday!
> 
> I'm given to believe everybody is watching Brazil just now.  Why won't that
> particular bail-out package, aimed at the finance sector as it is, go the
> way of its ill-starred predecessors elsewhere?  What have the would-be
> bailer-outers learned from the last year?  Anything?
> 
> And do the blatherings of the Krugmanites really add up to the proposition
> not only that free markets can fail, but that they definitively, ultimately
> must?  In regulationist parlance, have we a regime of accumulation here
> that's suddenly been confronted with the complete absence of an
> underpinning mode of regulation?
> 
> If so, is such a mode even imaginable at this point?
> 
> Er, you don't have to answer all of that lot ...
> 
> Best to all,
> Rob.
> 

-- 
Rosser Jr, John Barkley
[EMAIL PROTECTED]