Waiting for the big Kahuna Message Board

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Strategies & Market Trends : Waiting for the big Kahuna

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To: William H Huebl who wrote (66891)	10/20/2003 1:58:59 PM
From: Real Man	Read Replies (1) of 94695

One of the major derivative plays in the 90-s was the Yen carry trade - you borrow Yen at 1%, and invest the proceeds in US interest bearing securities. The same was done with gold, with lease rates below 1%. The size of gold carry trade is roughly known, since official estimates of all leased out gold from CB vaults around the world give 5,000 tonnes. Unofficial, more real estimates produce a figure of 15,000 tonnes, roughly 1/2 of all CB gold. That's physical gold, which was sold and consumed, and is now owed to Central banks. So? Are these banking guys feeling a little trapped right now or what? I somehow feel that this 4.62% yield level on the 10-year bond will be defended at all costs. These costs include crashing the stock market, if needed.

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