Last week, in response to the news of negative interest rates in Japan, I asked "And why is the yen still at 116? I must be overlooking something basically simple here. Or are the markets completely wacko?"
Well, the yen is sinking now, down to 123. Any guesses as to how low it goes? Back to test its 145-150 lows over the summer? Even further?
And, just as important, what are the consequences for US markets and Asian markets? The US bond market should improve, I would guess, as Asian, specifically Japanese, money comes back in. Just in time for Big Bang 2? Wasn't that supposed to happen around Dec of this year, more relaxing of currency flows? Or has the market completely twisted my mind out of shape? |
