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Blood On The European Streets As EUR-Yuan Carry Unwinds Crush Stocks
EURCNH was among the most popular carry trades - a stable long leg and central bank sponsored weakness in the sell leg. That is why, now that The PBOC has peed in the punchbowl, all that easy money carry has been forced to unwind as volatility forces traders to buy EUR and sell CNH en masse, shuttering the carry-funded trades as they go. No where is that more clearly visible than the plunge in European stocks.
*EUROPEAN SHARES CLOSE LOWER; STOXX 600 FALLS 2.7%
This is the biggest 2-day drop since 2014.
And no, there is no rotation to US of this 'money' as it is all credit-created positioning, once the carry-trade is unwound the entire funding position is removed from market liquidity.
Charts: Bloomberg
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It's all going to money heaven© Art Cashin.
Bullish money heaven.
Fairy gold always disappears when the new day comes. Betting on a "sure thing" is a great way to lose your ass....
What are the fuckwads at CNBC saying? That should be good for a laugh.
In may they even said "Liquidity is the most underappreciated risk factor out there."
Waz dis I be hearin''? Blood in de streets?!?! Liquidity underappreciated? Don wanna go der. DO NOT GO THERE! Ms Hillary gonna come affer you and bitch slap your sorry azz all de way to Kansas.....ya knows....fo Ms Megyn's sake. Ratty mo-fo.
I've got a few bottles of liquidity here in the liquor cabinet.....
Haha... All the eur/usd shorts are getting run through the wood chipper.
If the U.S. retail sales and jobs numbers come in lousy tomorrow, things are going to really accelerate, with the $usd selloff.
what kind of fucking turds have eur/yuan trade on anyway? a fucking idiot could see yuan devaluation ...
DRAGHI WILL BUY THEM
Please somebody say the fuse is lit this time!
The fuse is lit this time.
Happy?
Since Lehman...
ForEX has fucked soooo many people this year.
EURUSD traders beginning of year.
CHF fireworks
CNH fireworks
The realization that the Fed is not going to hike... 12 months into the foolish belief. Maybe the masses will wake up soon... or not.
Is the € dead yet? :D
Personally i'd like it back to 1.3€ vs 1 $ so when i go to NY for shopping, all stores have a "generic" ~25% discount just on the account of that!
OK Jim Rickards. We've had the 3.5% Yuan snowflake. Is this the avalanche?
Its a vaporization process being carried out by alien technology that found its way to earth a long time ago. It is designed to convert the value of exchange stored in money into the love of fellow bio-organisms--a peace bomb so to speak.
"...once the carry-trade is unwound the entire funding position is removed from market liquidity."
Thus setting the stage for tomorrow's shocking surprise that no one could have seen coming.
Annnd it's GONE! The Money's GONE!
www.youtube.com/watch?v=-DT7bX-B1Mg
Lunchtime PPT to the rescue. Dow up 100 points during 1st half of lunch break.
We're still being told however that liquidity issues don't apply to Government securies like Government Bonds.At least according to Paul Volker.What's the risk there I wonder?
China... the gift that keeps on giving. Enjoying those plastic trinkets yet ya fucking morons?