International:

The Goss Government Shredding files We have now added another report from the Australian Society of Archivists, the chief archivist of the Victorian Government (Chris Hurley) and the coalition government's response to the Manning Howard report into the Heiner Inquiry documents.

A very good example of the "them and us" syndrome.

The trading floor.

While Australia throws money at the Asian currency crisis - back in the USA the big money finance houses are doing everything they can to make a dollar from the crisis facing these countries.

Here is a first hand account from the Washington Post:

NEW YORK—"Go. Go. Go," shouted senior currency trader Joe Romeo, trying to be heard above the din at National Westminster Bank's trading room as he ordered novice trader Scotty Coughlin to buy $330 million U.S. dollars and sell the same amount of Japanese yen.

Coughlin, 25, was having trouble executing the order because another dealer was competing to buy dollars too. No one would trade him dollars for yen at a reasonable price. Every bid he made that December afternoon pushed the dollar higher, and the yen lower.

"Nobody's picking up. Nobody's picking up. We're getting jammed," screamed Coughlin, his eyes wide and strained.

This is the process by which Asian currencies have been shredded in recent weeks. Trades such as the one Coughlin attempted are what have been pounding currencies in Thailand, Indonesia, Malaysia, the Philippines, Taiwan, Hong Kong and, most recently, South Korea and Japan.

Furious-paced buying and selling lies behind the plummeting value of South Korea's won, for example, which has lost 57 percent of its value against the dollar so far this year, and the decline in the Japanese yen, which has slid 12 percent against the dollar.

The frenzy started at midyear when international investors who had long chosen to ignore the downside of the dynamics fueling many Asian nations -- the inflated real estate markets, the grandiose infrastructure projects and the overbuilt "strategic" industries -- started recognizing that the good times of supercharged economic growth were coming to an end. They wanted their money out -- and fast.

So they called traders such as Romeo and Coughlin, who can earn $500,000 to $1 million a year by remaining glued to their seats and computer screens. They eat at the trading desk, and when they have to go to the bathroom, another trader slides in to take their place because the $1 trillion-a-day market never stops.

It is simplistic to say that the traders are causing the crisis, analysts contend. Traders value currencies based on the relative economic and political strength of the nations that issue such currencies. Asian currencies have slipped primarily because the region's economic engine has stalled compared with the economies of the United States and Europe

Traders are surely profiting from Asia's woes, as the leaders of some Asian nations complain, but only because they are riding the current market trend, experts said. Their argument goes: Once confidence is restored in the Pacific economies -- however it is done -- the selling will stop.

As long as the market continues to drive these currencies down, though, the Asian crisis is not contained and the risk rises for global financial distress. The drop in the won not only makes it difficult for South Korean banks to repay their dollar-denominated loans, but, more worrisome to many in this country, it also makes Korean-made products less expensive for overseas consumers.

Economists say the plunging currency in South Korea could easily touch off competitive devaluations of currencies in other countries such as Japan -- for example, why should South Korea's Samsung products get all the sales and not Japan's Sony? Such a cycle could quickly undermine the profitability of European and U.S. companies and lead to calls for increased trade barriers.

Most currency speculators are betting that the yen has further to fall, according to NatWest's Romeo. He said traders are unimpressed by the recently announced Japanese economic stimulus package and its $2 billion intervention in the currency market to support the yen.

"Until we see a basic change in the health of the Japanese economy, the yen will trade lower," Romeo said. "They have problems in Asia that we don't think will change quickly. The U.S. still leads the world. Europe looks pretty good. So we sell Asia and buy the U.S. and Europe."

One of NatWest's customers, speculator Ray Dalio, who runs the Bridgewater Group of Wilton, Conn., agrees.

"What we do in the currency markets is impose financial discipline on governments," Dalio said. "Just as it's efficient to [make] Nike shoes . . . in China because it's less expensive, the free flow of capital adds to the efficiencies of economies."

He said two central banks are among his clients, using his trading strategies in the management of their own foreign exchange reserves.

Romeo uses a military analogy to describe the "dealing room" on the 21st floor of National Westminster Bank. "I would liken what happens here to firefights in a war zone," he said. "You're sitting there. Everybody's doing his thing. All of a sudden, boom, there's shooting everywhere, rapid-fire trading. It's over in a few seconds, a few minutes. Everyone calms down. The wounded get attended to. Then you move forward."

At midday earlier this month, as it does every day, NatWest headquarters in London electronically sent the New York office the "global book," a compendium of orders that customers had placed that day with the bank. The book, which generally contains $500 million to $1 billion of orders, is constantly passed around the world as one market closes and another opens.

The biggest order in the book that day was the $330 million yen-for-dollar exchange, to be executed when the yen reached 129.50 to the dollar. NatWest also had a $70 million bet of its own going that the dollar would strengthen against the yen.

Coughlin's challenge was to sell yen for dollars at the most favorable exchange rate, particularly because the customer was another unit of the bank.

That was why the young trader had Romeo over his shoulder. Romeo has been trading since 1982, and at age 36 is considered an old man in a young person's game.

"When I started in the business, most of the guys were street guys from the Bronx, just gamblers. Now it's more MBAs. Now the smart guys want a piece of the money too," he said.

Romeo and Coughlin were fixated on a computer screen displaying the dollar-yen exchange rate, waiting for just the moment to jump in. All around them in the dealing room, which is about half the size of a football field, scores of traders and sales people were screaming orders. Romeo and Coughlin had to shout to carry on a conversation.

As the dollar began to creep toward the 129.50 yen level, Romeo said, "We might be going out in a few seconds."

Coughlin started calling out the prices, which change several times a second. "41-46," he said. Translation: There were buy orders for dollars at 129.41 and sell orders at 129.46.

"No," said Romeo, advising Coughlin to hold his fire.

"44-46," he yelled.

"No," repeated Romeo.

"50 bid, 50 bid," Coughlin screamed. The yen had hit the 129.50 trigger point of the order.

"Go. Go," Romeo said.

Coughlin began frantically clicking his mouse, signaling other traders that he would exchange yen for dollars at the prices they were offering. He was seeking prices as close to 129.50 as possible.

Within seconds he had bought "a hundred" -- $100 million.

He still had $230 million to go, and there was a sense of panic in the air because the dollar was rapidly climbing relative to the yen. It climbed from 129.50 to 129.65, then 129.80. On a deal this big, these small percentage moves mean the difference between making and losing hundreds of thousands of dollars.

Suddenly, the boss of the dealing room, NatWest managing director Glenn Stevens, 34, appeared behind Coughlin and shouted, "Hang up. Hang up. Hang up everything."

Coughlin stopped chasing the dollar higher. He waited a few minutes for it to come back down. Then, he started buying again, gradually filling the rest of the order for an average price of 129.60, only 10 points, or "pips," above the trigger point.

Later, in his office overlooking Manhattan's South Street Seaport, Stevens said, "I was lucky, fortunate, right, whatever. It doesn't matter. The result was we paid 60 [129.60] instead of 80."

NatWest's profit on the previous day's trade, including the bank's side-bet, was about $100,000.

You Say:

Subject: re THE MAGICAL MONEY TREE?

let me see if I have this right:
There is no money for hospitals.
There is no money for education
There is no money for social welfare
There is no money for emergency services
There is no money for the military
and yet..... there is 500 million Australian Dollars for Korea.

I'm sorry, but I'm a little confused.
If there is no money for Australians, where did the 500 million Australian Dollars for the Koreans come from?

Perhaps we borrowed it from ATSIC.

Jason Cole

Subject: HELP YOUR NEIGHBOUR

C O P Y Friday, 26 December 1997
Senator the Hon. Richard Alston,
Minister for Communications,
The Senate, Parliament House,
CANBERRA A.C.T. 2600

Dear Minister,

M E E T J O H N D O E

Our Principals have directed us to seek, from you, confirmation that neither you nor your government brought any influence to bear on Network Ten Television to ensure that the abovementioned film was screened over the last hour of Christmas Day and the first hour and a half of Boxing Day 1997.

Undoubtedly "Meet John Doe" was intended, by the network, merely to be entertainment but were it to be shown in a prime time slot it might have been perceived to have been a modern day representation of an event which occurred nearly two thousand years ago with the same level of social concern and corruption but without the obvious religious overtones.

The government, and its predecessors in recent decades, has placed great emphasis on the need to turn the proverbial "blind eye" to inhuman acts committed by governments in other nations in order to build trade links. It has, it seems quite willingly, endorsed the actions of Australian State and Territory governments in their rush to dismantle the very concepts of discipline and patriotism, especially in their school systems. Goodwill towards neighbours has been, possibly deliberately, reduced to an event that is promoted, mostly just for commercial gain, only on December 25 and at the risk of incurring the annoyance of the all powerful minorities who do not share Christian principles.

Certainly there are those who understand that Australia's politicians lose contact with the real world once they enter the parliamentary "hothouse" scene and discover that they are not expected to much more than dutifully vote the party line when the bell rings and accept, perhaps without question, the advice of the minders that the non-parliamentary political party machine hierarchy places at their "disposal".

Reviewers of the film would also note the similarities between the power of the media in it and the extent of influence that the media moguls exercise here and now.

Your prompt and comprehensive reply is awaited with great interest.

Sincerely
J o n M. A x t e n s
(6 Slater Street, NORTH LISMORE 2480)

Personal trivia, from the global office:

Have a great day.

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