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Politics : High Tolerance Plasticity
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To: russwinter who wrote (1694)3/15/2001 6:48:41 PM
From: Archie Meeties  Read Replies (1) of 23153
 
"like most overplayed strategies it will be hard to get out the exit"

Have you read much on far-from equilibrium economics? The yen carry trade is best described by that theory, as is the gold carry trade. If you haven't read much of that theory, you've hit upon on of the key tenets to far-from equilibrium systems (by experience?). They proceed incrementally (selling gold in yen buying usd), are feed forward (buying dollars weakens gold, enticing more players to sell - with no natural balance in place), and they unravel with fury (at which point you understand just how far from equilibrium the market has become). This is in contrast with the usual model, which keeps the price of a commodity in balance by the feed-back of supply and demand.

Far from equilibrium models became possible of course when it became easy to create money with the stroke of a pen, click of a mouse...
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