Can anybody explain why the yen is so strong if the nikkei is falling 6%+ a day and Japanese banks need billions in bailouts? Shouldn't the yen be tanking just like the euro is against the dollar?
http://www.nytimes.com/2008/10/28/b...8banks.html?_r=1&pagewanted=print&oref=slogin good Japanese Yen story for you
Lots of Wall Streeters have an Asian fetish. Since a quarter of them got laid off, guess where they're going? Huge Yen demand.
http://www.nytimes.com/2008/10/28/b.../28yen.html?_r=1&pagewanted=print&oref=slogin The Boxer is dead on, and this article gives details
In the article they call it the "world's biggest easy money scheme", and so it was: you borrow at low rates from Japan, leveraged heavily, and then invest in a higher-yielding something or other elsewhere. A lot of those elsewheres were in Australia, Europe, and US. Now the US rate is going to 1% - once the dollar stops strengthening, a while down the road when risk appetite comes back... will it ignite a USD carry trade?
Maybe it is because as I read, not sure about it, the Asian Governments are trying to strength their economies in order to give a turn to the economy table.