Sun meets Rahu

[Guest guest]

Paulson Says Global Economy Strong

By Associated Press

March 6, 2007, 2:30 AM EST

 

TOKYO -- U.S. Treasury Secretary Henry Paulson said Tuesday that the

global economy is as strong as he's ever seen and that reforms in

China would help lessen the kind of market volatility that has

recently rocked international stock markets.

 

Paulson's trip to Tokyo, the first leg of a three-nation Asian tour,

comes amid turmoil in global stock markets and a sudden plunge of the

dollar against the yen.

 

Asian shares in particular have plunged over the last week amid

worries about overheated share prices and a global slowdown, although

many regional markets recovered Tuesday, showing that investors had

regained a measure of confidence.

 

Paulson tried to quell market concerns saying the U.S. and global

economy are strong and that stock market volatility is inevitable.

 

" The global economy is more than sound. It's as strong as I've seen

in my business lifetime, " Paulson said after meeting Japanese

officials in Tokyo.

 

" Markets very seldom move in a straight line, " said Paulson, who was

scheduled to later head to South Korea and then China. " You are

always going to have volatility. "

 

Paulson also said that economic reforms in China, the epicenter of

the recent meltdown, would help lessen such ups and downs. A 9

percent plunge in the Shanghai stock index last Tuesday was the

catalyst for the sell-off in global markets, including Wall Street.

 

On Tuesday, many Asian markets bounced back, with Tokyo's Nikkei 225

index rising 1.2 percent and Hong Kong's Hang Seng index rallying 1.6

percent in afternoon trading.

 

The U.S. dollar also recovered some after tumbling to 115.47 yen

Monday, its lowest since Dec. 8, from above 120 yen a week ago. On

Tuesday, it was trading at 116.37 yen.

 

Paulson and Japanese Finance Minister Koji Omi agreed Monday night

that there was no need to be concerned about the recent market

volatility and that markets mechanisms were functioning well, Omi

told reporters after their dinner meeting.

 

Both men also concurred that exchanges rates should be left to the

market, he said.

 

On Tuesday, Paulson applauded Japan's effort to reform the labor

market as important to sustaining growth and said he welcomed Prime

Minister Shinzo Abe's efforts in this area.

 

Later in the day, Paulson was expected to meet Bank of Japan Gov.

Toshihiko Fukui, who recently shepherded the central bank's second

interest rate hike since last summer, a quarter-point increase to 0.5

percent.

 

China's huge trade gap with the United States will likely be a focus

of talks in Beijing. The U.S. trade deficit with China hit a record

$232.5 billion last year, prompting more calls by Democrats in the

U.S. Congress for the Bush administration to do more to deal with the

soaring imbalance.

 

American politicians are also pressuring China to free up controls on

the movement of its currency, the yuan.

 

Critics in Washington say the yuan is artificially undervalued

against the dollar and that the difference gives Chinese exports an

unfair advantage on the world market.

 

While in Tokyo, Paulson told Japanese officials that Washington has

three main objectives in dialogue with China -- opening the service

sector to foreign investment, strengthening Chinese environmental

protection and accelerating the overall speed of Chinese economic

reform.

SAMVA , " cosmologer " <cosmologer wrote:

>

> Dear list members,

>

> One thought came to mind with regard to the SAMVA USA chart and what

> it suggests for today. Transit L2 Sun in H8 is running into close

> conjunction with transit stationary Rahu. This suggests some

> difficulty, even a brief crisis, for the funcitonal and general

> indications of the Sun. However, Rahu is the planet of deception and

> this may result in some acts of that nature with regard to the

> indications of the Sun. For instance, policy makers, strategists and

> analysts are now busy saying everything is all right, etc. However,

we

> should keep in mind that the transits involving the second house and

> its lord are highly afflicted at present. Transit stationary Ketu is

> conjunct H2 MEP, also signalling sudden disturbing events relating

to

> the wealth, status, close relations, the leader of the country, etc.

> Moreover, transit L8 Saturn in H1 is coming ever closer to its close

> aspect to natal L2 Sun in H7. Hence, the problems or the build up of

> adverse karma surrounding the second house and the general

indications

> of the Sun are only increasing. So, the events may not be straight

> forward. In other words, nothing moves in a straight line. However,

> the obstacles are there in a big way. Hence, the down trend should

> continue, while the daily stock prices can fluctuate quite a lot.

>

> One more thought. My prediction for a reduction in share prices was

> based on a prediction for a reduction in global liquidity. I was

> primarily focused on the US central bank raising its policy rates or

> keeping them higher than investors would like to see. The fact that

> the Japanese central bank raised the policy rate from 0.25% to 0.5%

> has caused some unwinding of the " Yen carry trade " with positions

> abroad being unwound and the funds returned to Japan. This is

serving

> to reduce the global liquidity. Moreover, I speculated that funds of

> foreign investors in the USA would be withdrawn. In short, the

> scenario is playing out as expected, although the reasons for it

have

> somewhat come as a surprise.

>

> Best wishes,

>

> Thor

>