Sunday, July 3, 2016

Central Bank Versus Central Bank

Japan's entire Abenomic policy was predicated upon the U.S. "recovery" and strong dollar. However Japan exported too much capital and U.S. yield implosion is causing the $3 trillion carry trade to unwind out control...This is the largest carry trade unwind since the Asian Financial Crisis...

PhD IQ test, weaken all four of these at the same time. Go:

Japan is imploding because the currency and economy were both massively leveraged to U.S. recovery. Abenomics is unwinding violently...

U.S. yield implosion is accelerating the unwind:

USDJPY (black) with Two year U.S. Treasury:

China is caught in the middle between weaker exports to the U.S. and carry trade unwind versus Japan...the worst case scenario for the Yuan:

Yuan versus dollar (black) and Yen (red)
% performance:

Japan's trade deficit with the U.S. went into the S&P 500
And now that flow of capital is reversing...

"Got hot money?"

Yen risk and Yuan risk are one and the same now. Accelerating lower...