Re Japanese Yen defense: I think part of might be an attempt to
act decisively to stem the capital flows (out of Japan, into
US bonds and equities, among other things) that we may have
seen a bit of since April 1 "big bang".
Probably the US authorities don't
object, either, since further yen erosion could be a serious
contractionary shock to our economy (with some latency period
before the effects set in), and big flows of Japanese
money into US assets could really exacerbate the US financial
bubble in the meanwhile. Stock bubble + recession = fun, fun, fun,
right? Can they do it? We'll see.
I'd love to see a post from someone very well informed (OK, someone
who knows more than I do, which ain't much) about the details of
Japanese liberalization. How much money, in practice, could be
rushing into our markets? This is really causing me to reevaluate
my views... I have been adding a bit to my bearish hedge
position (BEARX) though still somewhat net long,
but nowhere near the big shifts I would probably be making in the
absence of this Japanese money flow factor....
HB |
