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Bond rally nearing an end?
- Thread starter gharghur2
- Start date
A homemade yen-carry trade is to sell short Yen currency forwards. Arbitrage theory tells us that forward currency rates are decided by interest rate differentials between countries. Selling short Yen forwards is the same as borrowing yen at 0% and investing it in short term US rates.
Quote from ralph00:
A homemade yen-carry trade is to sell short Yen currency forwards. Arbitrage theory tells us that forward currency rates are decided by interest rate differentials between countries. Selling short Yen forwards is the same as borrowing yen at 0% and investing it in short term US rates.
Exactly! Thanks, that was the answer I was looking for. I don't do currencies at the moment. Would love to though.
Quote from ralph00:
A homemade yen-carry trade is to sell short Yen currency forwards. Arbitrage theory tells us that forward currency rates are decided by interest rate differentials between countries. Selling short Yen forwards is the same as borrowing yen at 0% and investing it in short term US rates.
Used to be a lot easier with the previous administration having a strong dollar policy, and the Japanese selling Yen to improve their current accounts...
Il Principe
Guest
Any uncertainty felt in the June minutes should certainly be erased by the bearish numbers from the past few days. Lots of shorts got hurt yesterday & today, but there's molto space underneath that move.
Il Principe
Guest
And as far as buying and rallying on said "uncertainty", that's definitely oxymoronic; can't think of the last time I heard that statement.
Falling shares and news of policy accomodation have been responsible for higher bond prices this week. Right now, everything is revolving around the continuation of the stock market decline. This is what I had to say on my blog today about the stock market:
<font color="F95C06" size=2><b>Tech is Trash. Now What?</b></font>
<br><font size=1><b>July 21st, 2006</b></font><br>
The tech sector decline cited by news headlines as the dominating event behing falling stock indices this week reminded many of us of the year 2000. Microsoft's share price drop in January 2000 signaled the end of the roaring 90's when technology was the driving factor behind skyrocketing share prices and higher wages, and when they last fell in late April of this year, the overall stock market again followed suit shortly after. But this time, the last rally didn't have as much to do with technological progress as what is suggested by the influence the tech sector has been exercising on general indices since May.
Recent economic data was mixed and, considering the inflationary pressures coming from energy prices and the current level of interest rates, monetary policy is rather accommodative. So the question that I want to raise now is <b>when will the stock market get guidance from other sources than the state of the tech sector?</b>
Ideally, I would like to know which factor will influence the stock market next but the answer to that question is, based on my experience, almost impossible to know. <b>The stock market will look elsewhere whenever the events of the day are favored by internal conditions as a pretext to either change direction or extend the trend</b>. In the meantime, I think that an economic slowdown has been fully discounted and that we are nowhere near a recession.
<br> <br>
<font color="F95C06" size=2><b>Tech is Trash. Now What?</b></font>
<br><font size=1><b>July 21st, 2006</b></font><br>
The tech sector decline cited by news headlines as the dominating event behing falling stock indices this week reminded many of us of the year 2000. Microsoft's share price drop in January 2000 signaled the end of the roaring 90's when technology was the driving factor behind skyrocketing share prices and higher wages, and when they last fell in late April of this year, the overall stock market again followed suit shortly after. But this time, the last rally didn't have as much to do with technological progress as what is suggested by the influence the tech sector has been exercising on general indices since May.
Recent economic data was mixed and, considering the inflationary pressures coming from energy prices and the current level of interest rates, monetary policy is rather accommodative. So the question that I want to raise now is <b>when will the stock market get guidance from other sources than the state of the tech sector?</b>
Ideally, I would like to know which factor will influence the stock market next but the answer to that question is, based on my experience, almost impossible to know. <b>The stock market will look elsewhere whenever the events of the day are favored by internal conditions as a pretext to either change direction or extend the trend</b>. In the meantime, I think that an economic slowdown has been fully discounted and that we are nowhere near a recession.
<br> <br>
the stock market is really a load of feces.....
the Oil Services Holder Trust (OIH) was gunned down today and the final tick at 4:00:00 PM was exactly 130.00 on the number....all the stox in the trust had charts that looked identical
all while crude was up and Isreal was ready to invade........
I complained to the SEC (no laffing) as I watched every bid tick on BHI, HAL, WTF get pounded until the trust index hit 130.00 at the close...........
why bother with all this BS
the Oil Services Holder Trust (OIH) was gunned down today and the final tick at 4:00:00 PM was exactly 130.00 on the number....all the stox in the trust had charts that looked identical
all while crude was up and Isreal was ready to invade........
I complained to the SEC (no laffing) as I watched every bid tick on BHI, HAL, WTF get pounded until the trust index hit 130.00 at the close...........
why bother with all this BS
Yesterday's move for the most part options related and I am sure a couple of you guys would like to hear that one or two of the bigger 5yr locals got a taste of their own medicine with this algorithm. Look at 5yr time and sales for electronic around 10:25am, yep, that is a 10,000 lot hitting one of the spoof bids and offers that these guys usually show. They maybe scratched a 1000 of the 103-31's and for the most part puked them at 30.5 and 30. Dealers were massive short the August 106 calls into expiration (75,000 were open) and the level was well defended when the 10yr traded up to 26 right after the open.