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Spot The Difference
As the investing public looks around for reasons why US equities are rallying, the harsh reality is highlighted in the following chart... all that matters is what JPY carry is doing. While correlation is not causation, we suspect you'd be hard-pressed to suggest we are not on to something here...
What is perhaps most worrisome is that the vertical ramp in both USDJPY and S&P 500 both began as NASDAQ imploded... at 1253ET
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there is no difference when we're all in the nut house togeather
Pairs arbitrage bitchez!
Try the aapl goog pair....we are all Japanese again
This is now my basic premise to life:
"it's basically a neutral event... It's No Big Deal!"
- Nobel-Prize-winning economist Eugene Fama
How did Rick Santelli get Fama to say that...pretty cool trick.
Can't wait for the "no big deal"...1929 all over again.
"there is no difference when we're all in the nut house togeather"
beg to differ but some of us march counter-clockwise
It's bigger, keep diggin.
There is if you are not getting the tranquilizer meds.
Yellen is Nurse Ratchet.
http://www.leelaughead.com/wp-content/uploads/2020/11/nurse_ratched_one_...
@TruthinSunshine, your link = 404....try again....I need a good laugh today.
I thought the S&P was rallying due to the trillions of dollars the Obama regime was going to have to dump into tech companies to get their damn website working...
Asian markets might be interesting this evening
Obama!
ITALY DOWNGRADED BY PETERSSEN TO JUNK
Who's P and why should we care?
Anyone mind breaking this down a little bit more, for us less market gifted?
Just need a little help knowing what bear is shitting in what buckwheat and for what effect...
Thx in advance
It has to do with the correlation of US stocks and "risk" currency pairs.
The carry trade is the differential between US interest rates and Japanese interest rates and it is paid to the holder of the currency that has the higher bond yield. In this case, buy US dollars against Japanese yen and you make money by simply parking cash in dollars. The less fear there is in the market, the more traders are willing to "risk" getting caught holding dollars, hence the USDJPY pair rises along with other risky assets, such as the SPX.
On the other hand, when there is fear in the markets and traders are becoming risk averse, they will sell USD against JPY because JPY has become a safe-haven currency of sorts and is quite liquid in its own right.
Also, the EuroYen trade follows the SPX even more closely than does the USDJPY pair.
:D
If you look at the year open and compare yen versus SP500, there's massive divergence from few months ago, so these posts by Tyler are cherry-picking the occasional day open correlations, which seems a bit insincere.
I guess it's the fact that Tyler is asking me to spot "difference" when...to my untrained eye, I see similarity...
That statement is decidedly false. The correlation of UJ to SPX has been very tight for some time and now (like since 2007...). After the advent of Abenomincs and the normalisation of the yen, it is correlating even more so than before.
:D
Can you post a chart please?
I'd like to see this 'bigger picture' you speak of, rather than these day open snap-shots, txs.
One of hundreds of articles:
http://www.kathylien.com/site/forex-blog/correlation-between-eurusd-usdjpy-and-stocks
This one from 2009.
:D
Inflation in the price of stocks is inflation. You get less of them for every dollar.
We have massive inflation taking place right now.
Long US & Japanese Funeral Directors
Knew Kathleen Sebelius had a backup plan...good tip! Back to the old family job, makes sense now.
why don't they just call it the musical chair market? when the music stops it will be quite apparent.
Like "Indypat", I would be highly obliged if some fine financial expert could explain those charts for a dumbass such as myself, who committed the cardinal error of learning a productive profession rather than hawking toxic paper.
when a line on a chart goes up, that is "good".
Both lines in that chart are going up, so that's "great"!
You don't say !
It's just complying with the Bernankian Law of Physics: What goes down must go up".
Who has the counterparty risk?
me, Oct 16th "They'll up dividends, perform stock buybacks, and reborrow at 3% interest to fund their current liabilities."
today. http://www.marketwatch.com/story/ibm-board-approves-quarterly-cash-dividend-authorizes-15-billion-for-stock-repurchase-2013-10-29
Didn't you know one yen can be used to buy a dollar worth of stock....so you just convert your one dollar to 98 yen then buy 98 dollars worth of stock. It is so simple a Corzineman could do it!