The best investment of 2008: the Yen

[hayekvindicated]

http://goldnews.bullionvault.com/yen...rade_101620084

Beating all stock markets, bonds, currencies and precious metals. As the carry trade unwinds, the Yen may still have some steam left.

[phirang]

Re: The best investment of 2008: the Yen

I love da Yen.

Problem is, BoJ really don't care for it.

I'd advise closing out spec positions. Hedges are ok to maintain, but in about a month or so, all the CDS damage will be revealed openly, and the carry trade will resume once again.

You can bet on THAT.

[The Outback Oracle]

Re: The best investment of 2008: the Yen

I love da Yen.

Problem is, BoJ really don't care for it.

I'd advise closing out spec positions. Hedges are ok to maintain, but in about a month or so, all the CDS damage will be revealed openly, and the carry trade will resume once again.

You can bet on THAT.

I tried backing the Yen late 2007! I nearly got cleaned out. I ended up with a minor profit, after being seriously "down" from time to time. It shook me so much, that markets can be SOOOOO irrational, i didn't give it another whirl this time when i'd have made some REALLY serious money!

[hayekvindicated]

Re: The best investment of 2008: the Yen

I love da Yen.

Problem is, BoJ really don't care for it.

I'd advise closing out spec positions. Hedges are ok to maintain, but in about a month or so, all the CDS damage will be revealed openly, and the carry trade will resume once again.

You can bet on THAT.

Ive made money on the Yen this year although in my current trade Im down a little bit - although in profit overall.

BoJ don't care for it but other central banks are also destroying their currencies a lot faster. Also, with $7 Trillion or so of Japanese "carry trade investment" heading back home, I reckon it should continue to get stronger. Also, BoJ won't cut rates any lower whereas other banks will probably continue to do so.

I believe that whether one makes a conscious decision or not, one inevitably chooses a currency in which to park one's cash. Right now my cash is in Sterling, which is probably the worst currency to be in (among the major ones). So I had to hedge myself by putting in a Yen trade to avoid watching my savings get destroyed by Brown and his crew.

[hayekvindicated]

Re: The best investment of 2008: the Yen

I tried backing the Yen late 2007! I nearly got cleaned out. I ended up with a minor profit, after being seriously "down" from time to time. It shook me so much, that markets can be SOOOOO irrational, i didn't give it another whirl this time when i'd have made some REALLY serious money!

You said it mate. The pound actually strengthened 5 percent on news that the British Government will spend £700 billion in total to shore up the banks! If that isn't crazy I don't know what is.

[The Outback Oracle]

Re: The best investment of 2008: the Yen

You are absolutley right Friedrich. The pound looks really screwed to me long-term (and short term). But who knows what goes through the heads of the ptb these days. My fear in the A$ vs Yen trade, is that the Chinese will stop buying US Treasuries and get really serious about buying the rest of Aus that someone else has not already bought. We will sell it to them because other than a handfull of blokes, noone gives a rats. And trying to talk to people, or the media, about the Foreign account is pissing into the wind. And you know the result of that. So, the effect of a more concentrated effort by the Chinese could lead to the A$ to rally against just about anything.

Australians (except Steve Keen) are still sitting here saying she'll be right! The government will save us! Everyone loves us anyway! Get rich by buying more houses! Noone has even begun to think what the reversal of the carry trade means.
The other factor here is the Reserve bank which runs a PPT. I once heard the Governor of the reserve bank give a 30 min talk on why we had no savings without once mentioning the word Inflation. So, it treads to the beat of a different drummer, and it is not a beat I comprehend.

[hayekvindicated]

Re: The best investment of 2008: the Yen

You are absolutley right Friedrich. The pound looks really screwed to me long-term (and short term). But who knows what goes through the heads of the ptb these days. My fear in the A$ vs Yen trade, is that the Chinese will stop buying US Treasuries and get really serious about buying the rest of Aus that someone else has not already bought. We will sell it to them because other than a handfull of blokes, noone gives a rats. And trying to talk to people, or the media, about the Foreign account is pissing into the wind. And you know the result of that. So, the effect of a more concentrated effort by the Chinese could lead to the A$ to rally against just about anything.

Australians (except Steve Keen) are still sitting here saying she'll be right! The government will save us! Everyone loves us anyway! Get rich by buying more houses! Noone has even begun to think what the reversal of the carry trade means.
The other factor here is the Reserve bank which runs a PPT. I once heard the Governor of the reserve bank give a 30 min talk on why we had no savings without once mentioning the word Inflation. So, it treads to the beat of a different drummer, and it is not a beat I comprehend.

My reasoning on the Pound is that unlike the Dollar, nobody really cares what happens to Sterling. The Japanese and Chinese don't give a damn about Sterling. Also, British households have even higher debts (relative to income) than the Americans and Britain's Trade and Budget deficit numbers look horrific.

Ergo, the only reason to buy Sterling would be a higher rate of interest (and a belief that it won't drop any further) - and that too will disappear shortly as the BOE tries to shore up households with rate cuts. Once the rate falls to 4 percent and below, there is no reason left to remain long Sterling. Some are clamouring for the interest rate to be cut to 2.5 percent.

Australia does have a few things to offer as a country - including raw materials which the Chinese can use. Britain has no manufacturing left, no natural resources, finance is bust, the government is bloated (spending as a percentage of GDP went through the roof under Blair and Brown) and the people are up to their eyeballs in debt. That looks like a classic exchange control scenario to me. It won't be the first time the British will have bankrupted themselves, except this time the Americans are also broke and cannot give any help.

[phirang]

Re: The best investment of 2008: the Yen

My reasoning on the Pound is that unlike the Dollar, nobody really cares what happens to Sterling. The Japanese and Chinese don't give a damn about Sterling. Also, British households have even higher debts (relative to income) than the Americans and Britain's Trade and Budget deficit numbers look horrific.

Ergo, the only reason to buy Sterling would be a higher rate of interest (and a belief that it won't drop any further) - and that too will disappear shortly as the BOE tries to shore up households with rate cuts. Once the rate falls to 4 percent and below, there is no reason left to remain long Sterling. Some are clamouring for the interest rate to be cut to 2.5 percent.

Australia does have a few things to offer as a country - including raw materials which the Chinese can use. Britain has no manufacturing left, no natural resources, finance is bust, the government is bloated (spending as a percentage of GDP went through the roof under Blair and Brown) and the people are up to their eyeballs in debt. That looks like a classic exchange control scenario to me. It won't be the first time the British will have bankrupted themselves, except this time the Americans are also broke and cannot give any help.

England should get off the crack and move onto the hard stuff... dollars.