Sunday, February 14, 2016

1997 Deja Vu. The Era of Central Bank Control Is Over

Gamblers are Black Swan diving into pavement


Carry trade unwind has rendered the Bank of Japan irrelevant. The tail is no longer wagging the dog...

"Citigroup, which oversees about $2.4 trillion, says it’s buying yen and selling dollars as the tumult gripping financial markets bolsters the Japanese currency’s appeal." 

"We’re not counting on the market mood shifting any time soon," said Steven Englander, Citigroup’s New York-based global head of Group-of-10 currency strategy. Citigroup, world’s biggest foreign-exchange trader according to Euromoney magazine, expects haven currencies including the yen, euro and Swiss franc to appreciate in the near term,"

Central Bank loss of control visualized:
Yen long Futures Commitment at four year high (black) with Dollar/Yen (red):

"Just the start..."

Dollar Yen (red) with S&P (Daily):


:15 min