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USDJPY Reacquainted With Gravity

Tyler Durden's picture


Zero-G free fall follows. But...But... the USDJPY is going to 105-110 they said. Don't fight the Japanese Fed they said. Elsewhere, the Watanabe retreat bugle just became the Watanabe gong show. For now, GETCO and DE Shaw's USDJPY-ES correlation algos are furiosuly pretending to ignore what is going over in FX land. We wish them luck...


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Thu, 06/06/2013 - 11:04 | 3629821 slaughterer
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DE SHAW celebrate most excellent drop in now reverse carry pair trade with comrade Tepper crew

Thu, 06/06/2013 - 11:18 | 3629900 WestVillageIdiot
WestVillageIdiot's picture

I hope some ZH'ers are making money on this drop in the Yen.  I can never figure out how to do that trick. 

Thu, 06/06/2013 - 11:24 | 3629937 mayhem_korner
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Might help if you first realize that the Yen is strengthening against the USD.  It's the USD that is dropping in this pairing.

Thu, 06/06/2013 - 11:29 | 3629957 WestVillageIdiot
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Statler and Waldorf, is anybody on ZH making money off of this?  I hope so.  Take it from the hedge fund b-bags and make my day brighter.

Thu, 06/06/2013 - 11:45 | 3630020 El Viejo
El Viejo's picture

I made a little with YCS but be careful with the decay factor on some of these plays. (Get in and out in a short time frame)

Thu, 06/06/2013 - 11:57 | 3630107 WestVillageIdiot
WestVillageIdiot's picture

The fucking Yen is on more PEDs right now than Alex Rodriguez ever was. 

The Yen is skyrocketing at noon EST. 

Thu, 06/06/2013 - 12:01 | 3630116 El Viejo
El Viejo's picture

Yep, I sold my YCS near the top and now waiting for the freefall to end. I lived in Japan for a couple f years. It's and interesting place. They do things at specific times of the year. They tend to adjust their currency near September, but these days who can figure anything .

Thu, 06/06/2013 - 12:07 | 3630164 Fleecer
Fleecer's picture

gonna need moar y-axis

Thu, 06/06/2013 - 12:19 | 3630234 mayhem_korner
mayhem_korner's picture




Thu, 06/06/2013 - 12:28 | 3630263 Oracle of Kypseli
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You can stop gamma rays with thick walls of lead, but you can not stop gravity.

Check with all the quantum physicists. Gravity is a problem. Despite Bernanke's explanation that the earth sucks  

Thu, 06/06/2013 - 12:00 | 3630120 CrashisOptimistic
CrashisOptimistic's picture

1) The oldsters in US Ts are making money on it.

2) Don't fight the Japanese Fed, unless you bet on reality, which is that the US Fed will buy Yen and NOT allow Toyota to destroy the Administration's showcase GM.

3) For the first time since the global circle jerk started, all the CBs have stopped working together.  They will not allow Japan to collapse its yen.  Too much risk to other country exports.

4) Japan is in huge trouble if other countries oppose BoJ maneuvers.

Thu, 06/06/2013 - 12:08 | 3630173 NotApplicable
NotApplicable's picture

Cartels can never truly work together for very long, as the incentive to merely manage others' expectations (read: cheat) is too strong in comparison to the dangers of breaking the whole scam (right up until it starts to unwind). So, they kind of work on a pendulum between these two extremes, with all actors lying the whole time.

Thu, 06/06/2013 - 12:14 | 3630202 CrashisOptimistic
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Well said, case in point the G7 congratulating Japan on its boldness and imagination and how they all supported Japan's efforts -- whilst their own CBs were buying yen hand over fist to oppose those efforts.

Hard to make a case for this spike in the Yen being anything other than CB buying via proxy.

Thu, 06/06/2013 - 12:38 | 3630335 markettime
markettime's picture

Just BTFD in gold. 

Thu, 06/06/2013 - 11:07 | 3629837 Xue
Xue's picture

Deflation bitch!

Thu, 06/06/2013 - 11:16 | 3629890 LawsofPhysics
LawsofPhysics's picture

only if the japanese don't need to eat or use energy...

good luck with that.

Thu, 06/06/2013 - 11:28 | 3629950 WestVillageIdiot
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Or go to college, buy insurance, wear clothes (I've seen no deflation there), drink beer, etc. etc.

I do not see price deflation anywhere.  The debt charts are all parabolic.  So, where the hell is this deflation?  Seriously.  It is like Santa Claus.  I hear about it, but I never seem to see it.  Except in the interest rate I get from the bank.  Is that it?

Thu, 06/06/2013 - 11:34 | 3629986 MachoMan
MachoMan's picture


Thu, 06/06/2013 - 11:36 | 3629999 WestVillageIdiot
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What are these "wages" of which you write?

Thu, 06/06/2013 - 12:09 | 3630183 NotApplicable
NotApplicable's picture

The funding mechanism for Obummercare.

Thu, 06/06/2013 - 11:07 | 3629838 roymunnson
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That Kyle Bass guy was right

Thu, 06/06/2013 - 11:12 | 3629867 YC2
YC2's picture

Check your pocket for nickels!  

Thu, 06/06/2013 - 11:08 | 3629842 nope-1004
nope-1004's picture

Looks like a PM chart.  Obviously no gaming in this trade either.......


Thu, 06/06/2013 - 11:08 | 3629843 Yen Cross
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    That trade is getting blasted!  NIKKEISHIMA Bitchez.

Japan NI225    12,744.00    12,904.02    12,979.00    12,724.00    [-160.02    -1.24%]    15:03:1

Thu, 06/06/2013 - 11:09 | 3629845 BandGap
BandGap's picture

There is a strange similarity with all these Japanese charts.


Thu, 06/06/2013 - 11:13 | 3629874 daily bread
daily bread's picture

yes, they look like the flightpath of a kamikaze pilot

Thu, 06/06/2013 - 11:22 | 3629920 Oldballplayer
Oldballplayer's picture

I had to log in the up arrow that. That shit is funny.

Thu, 06/06/2013 - 12:10 | 3630186 NotApplicable
NotApplicable's picture

That's racist!

Thu, 06/06/2013 - 11:10 | 3629852 insanelysane
insanelysane's picture

At some point, technicals matter.

Thu, 06/06/2013 - 11:32 | 3629979 WestVillageIdiot
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Reading your comment quickly, I read the comment as, "at some point, testicles matter".  That was funny. 

Thu, 06/06/2013 - 11:56 | 3630103 Yancey Ward
Yancey Ward's picture

Nothing hurts worse than getting hammered in the technicals.

Thu, 06/06/2013 - 12:11 | 3630190 NotApplicable
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Ow, my calls!

Thu, 06/06/2013 - 11:10 | 3629854 slaughterer
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"History shows again and again that nature shows up the follies of men..."

Thu, 06/06/2013 - 11:35 | 3629995 Shooting Shark
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"Daishikyuu hinan shite kudasai."

Thu, 06/06/2013 - 12:02 | 3630129 Yancey Ward
Yancey Ward's picture

Oh, no, there goes Tokyo.

Thu, 06/06/2013 - 13:28 | 3630575 1000924014093
1000924014093's picture


Thu, 06/06/2013 - 11:11 | 3629856 Dr. Engali
Dr. Engali's picture

It will be interesting to see who blows up with this kind of currency volatility.

Thu, 06/06/2013 - 11:11 | 3629861 Everybodys All ...
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Kuntlow's king dollar is getting hammered right now.

Thu, 06/06/2013 - 11:33 | 3629983 WestVillageIdiot
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He's too busy to care. He's at the Minneapolis airport asking the guy in the stall next to him for toilet paper. 

Thu, 06/06/2013 - 11:46 | 3630047 Clueless Economist
Clueless Economist's picture

Larry "Wide Stance" Craig will give him more than toilet paper.

Thu, 06/06/2013 - 11:51 | 3630065 WestVillageIdiot
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Just think if you are ever in an airport bathroom and you actually do need toilet paper.  That's a dilemma. 

Thu, 06/06/2013 - 11:12 | 3629868 LawsofPhysics
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So WWIII will get started in Asia then.  Boy, the syrians will be disappointed < sarc off >

Thu, 06/06/2013 - 11:13 | 3629870 ghengis86
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So why is Yen strengthening with outright monetization? Front running inflation or FX?

Thu, 06/06/2013 - 11:15 | 3629882 LawsofPhysics
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both, the death of all Fiat.

Thu, 06/06/2013 - 11:23 | 3629927 ghengis86
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Then the delicious irony is the more Abe prints the more yen gets bought? Lol. Why can I - some know nothing douche on the Internetz - gets this but our overlords cannot?

Thu, 06/06/2013 - 11:34 | 3629987 RafterManFMJ
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Why can I - some know nothing douche on the Internetz - gets this but our overlords cannot?


It is difficult to get a man to understand something, when his salary depends upon his not understanding it!-Upton Sinclair

Thu, 06/06/2013 - 11:50 | 3630057 thereisonlyonelaw
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I do not know where demand is coming from but there are two things to consider:


1. Repatriating foreign investments to cover losses from other assets (bonds). This may also explain the fall in the Nikkei.

2. Belief that the QE is not going to continue (partly due to bond fears) and that Abenomics was just a fad with no consequence.


It's important to remember that even at these prices, the yen is still far above where it was not that many months ago. This may simply be short term profit taking.

Thu, 06/06/2013 - 11:12 | 3629871 slaughterer
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Get Bass on Bloomberg with some deadpan doom proclamation and Abe is ready to push the "USD/JPY astro ramper" (TM Samsung).  

Thu, 06/06/2013 - 11:13 | 3629873 SheepDog-One
SheepDog-One's picture

Don't fight the Fed's....well up until they suddenly just pass out and drop to the floor....then you can fight em I guess.

Thu, 06/06/2013 - 11:34 | 3629990 RafterManFMJ
RafterManFMJ's picture

Then it's time to put the boots to them.

Thu, 06/06/2013 - 11:13 | 3629875 slaughterer
slaughterer's picture

Luvin' my crude futures about now...

Thu, 06/06/2013 - 11:14 | 3629877 LawsofPhysics
LawsofPhysics's picture

Teasuries must be purchased...


Thu, 06/06/2013 - 11:18 | 3629902 SheepDog-One
SheepDog-One's picture

Must.....Buy moar.....Bawnds......

Thu, 06/06/2013 - 11:15 | 3629879 mayhem_korner
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I haven't looked, but the manipulated Au price must be shooting up close to the unbreakable 1414...the Bernank is going to have put the engine in reverse for a couple hours to stick-save the USDJPY and prevent a supernova short squeeze in "the yellow metal".

Thu, 06/06/2013 - 11:38 | 3630005 WestVillageIdiot
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Just think if the Bernanke made a definitive statement that no taper is on the table.  We might see the Yen back at 80.  How does it feel?  Oh, how does it feel?

Thu, 06/06/2013 - 11:17 | 3629895 SheepDog-One
SheepDog-One's picture


Thu, 06/06/2013 - 11:17 | 3629899 SheepDog-One
SheepDog-One's picture

US markets doin the Vinnie Barbarino immitation....'What....who.....where....what'?

Thu, 06/06/2013 - 11:18 | 3629901 mayhem_korner
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Ben's RMS Print-tanic must be trying to shift into reverse from its 25 knot, full-speed-ahead pace.  Lotsa wealth changing hands right now...

Thu, 06/06/2013 - 11:20 | 3629907 SheepDog-One
SheepDog-One's picture

Like indians trading 'bead wealth' between will come out the winner with the best sack of beads I suppose.

Thu, 06/06/2013 - 11:52 | 3630073 repete
repete's picture

or you could loose and end up with NYC

Thu, 06/06/2013 - 11:21 | 3629911 Yen Cross
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  LMAO!  You guys are on the roll today. Keep up the good work.

Thu, 06/06/2013 - 11:33 | 3629982 BigJim
BigJim's picture

You trade this, don't you? How do you keep from losing your shirt?

Thu, 06/06/2013 - 11:40 | 3630021 Yen Cross
Yen Cross's picture

   I trade the right direction. I obey my t/p & s/l targets. Volatility is a good thing if you use discipline.

Thu, 06/06/2013 - 11:21 | 3629912 SheepDog-One
SheepDog-One's picture


Thu, 06/06/2013 - 11:22 | 3629924 DeadFred
DeadFred's picture

That devaluation from 78 to 103/$ wasn't because the JCB was printing yen, it was mostly yen printed by the banks making loans for carry trade positions deemed profitable because Abe was going to print yen. If the carry trade collapses all those positions will quickly reverse. Eurozone bonds will drop, the yen will retrace much of it's devaluation, the hallowed US stock market will drop and all those rehypothecated positions will become vulnerable. Good thing we have all those sure-fire US treasuries to backstop everything... oh yeah the Fed took most of them out of circulation. Oops. Oh well, with Obama's scandals suddenly empowering the Repubs the new debt ceiling debate <weren't we done with that?> was going to make the rating agencies unhappy with those treasuries anyway.

Other than that things are peachy keen

Thu, 06/06/2013 - 11:24 | 3629933 slaughterer
slaughterer's picture

Toga party at Hayman right now... Bass out back shooting vermin with a 12 gauge... phone calls from Bloomberg not answered...

Thu, 06/06/2013 - 11:35 | 3629996 TheEdelman
TheEdelman's picture

Im sure KB has had a perma wood for a few days now and doesnt need a spear for his favorite past time...spear fishing.  

Thu, 06/06/2013 - 11:40 | 3630019 WestVillageIdiot
WestVillageIdiot's picture

I think Kyle Bass is great to listen to.  But I thought he was calling for the Yen to keep falling.  He seems like one of the smartest, most genuine guys out there.  He would never make it in government, especially this most transparent of administrations.

Thu, 06/06/2013 - 11:36 | 3629997 BigJim
BigJim's picture

Hold on... Bass' prophecy was the yen collapsing, not strengthening.

I think he'll be right, eventually... just not yet. 

Thu, 06/06/2013 - 11:43 | 3630031 Bohm Squad
Bohm Squad's picture

I believe KB said the Yen would likely strengthen before it collapses...or that was a likely outcome.  It looks like the carry trade is being unwound by those who are afraid to risk their principle in lieu of getting that rollover credit.

Thu, 06/06/2013 - 11:25 | 3629939 rajc
rajc's picture

hey do they have a pretend parameter? how would that work? does it work based on twitter feeds or manual input? does value of 0 mean dont pretend or pretend?

Thu, 06/06/2013 - 11:29 | 3629953 Yen Cross
Yen Cross's picture

     Hey everyone lets pile into the euro. No news is good news. Bond yields are blowing out again, but the swaps lines are still open.

  farkin retards!


        Spain 10-Year   [ 4.653]    4.637    4.698    4.444    0.016    0.35%    15:20:00
         Italy 10-Year  [  4.329 ]   4.145    4.386    4.142    0.184    4.44%    15:19:53


Thu, 06/06/2013 - 11:29 | 3629959 slaughterer
slaughterer's picture

USD/JPY == > 93 target.

Thu, 06/06/2013 - 11:41 | 3630023 WestVillageIdiot
WestVillageIdiot's picture

39 would be funnier.

Thu, 06/06/2013 - 11:32 | 3629977 Downtoolong
Downtoolong's picture

That's gonna hurt come winter.


Thu, 06/06/2013 - 11:32 | 3629980 slaughterer
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The sure failure of the Japan monetary experiment will be one big "Lehman moment" repeat.   Everybody will realize in glaringly obvious fashion that central banks make big mistakes.  

Thu, 06/06/2013 - 11:35 | 3629993 LawsofPhysics
LawsofPhysics's picture

"Everybody will realize in glaringly obvious fashion that central banks mis-allocate and mal-invest captial and resources" - fixed  Yes, but will your representation (a puppet for said bank) roll the guillotines and fix this.  I'm guessing no.

Thu, 06/06/2013 - 12:17 | 3630223 Things that go bump
Things that go bump's picture

I'm afraid that is a DIY sort of activity

Thu, 06/06/2013 - 11:45 | 3630037 Confundido
Confundido's picture

So, the USD is falling against every ccy but gold cannot break $1,405/oz to the upside????

Thu, 06/06/2013 - 11:53 | 3630079 WestVillageIdiot
WestVillageIdiot's picture

I think the Lone Ranger shot Silver.

Thu, 06/06/2013 - 11:49 | 3630055 Tombstone
Tombstone's picture

Luckily, Benny has rescinded the laws of gravity over here.  Nowhere to go but up.

Thu, 06/06/2013 - 11:55 | 3630095 Confundido
Confundido's picture


Thu, 06/06/2013 - 12:44 | 3630375 q99x2
q99x2's picture

Maybe I look at KIA. Toyota too expensive today.

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