Carry Unwind Picks Up As Intraday Asset Correlation Approaches 1

Asset correlations are high, which is never a good sign for a market as psychotic as this one. Stock weakness translating into UST and dollar strength almost tick for tick. Curiously, the 7 yr that saw such a vigorous reception yesterday is being sold off the heaviest on a duration adjusted basis.

The Yen is surging with the traditional carry pairs dropping. Cable about to break 1.60, and the euro is now below 1.39: dollar just pushed back to highest levels since July.

Comments

[MsCreant]

When the unwind gets going good, I wonder if the planet will spin faster? And then when the unwind is done, does the planet slow down, stop, or spin in the other direction, sending us backwards in time?

[Anonymous]

Dollar: You spin me right round, baby
right round like a record, baby
Right round round round
You spin me right round, baby
Right round like a record, baby
Right round round round

[butchee]

MsCreant, you always pose the most provocative questions....I have been wondering the same question with a bit more banal slant:  When the USD unwind gets going do the same assets that formerly bubbled pop?  Or is there some other path for the unwinding, because nothing is truly reversible and the same rules and circumstances under which the wind up occured no longer apply?

[Ripped Chunk]

Does that mean Leno will be on earlier?

[faustian bargain]

And how would this affect my Tivo.

[Hephasteus]

Bitrate tax. 7mb/second now costs 8 mb/second.