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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: NOW who wrote (47045)	12/11/2005 6:46:52 PM
From: mishedlo	Read Replies (2) \| Respond to of 110194

I do not know when you bought but remember all the YEN bulls way back when China was going to float or repeg and it would be the death of the dollar? YEN bulls are getting crucified. Mish

To: NOW who wrote (47045)	12/11/2005 8:51:48 PM
From: Taikun	Read Replies (2) \| Respond to of 110194

The Yuan repeg and Yen zero interest rate policy (zirp)share similarities, IMO. I believe much of the projections for a strong Yen in 05 were originally based on a strengthening Japanese economy, as US economy weakens, and the quick end to the zirp. Instead Tokyo dragged its heels but in the end wil probably increase overnight rate when noone is looking, or on the heels of two increases by Bank of Korea, the most recent 25bp taking their overnight rate to 3.75%. How the Yen can expect to survive against it's brother, the Won, under zirp is beyond me. I think the end of zirp is very near, otherwise as Coxe points out we may have problems with USD support from the Japan+China team. While oil was weak, perhaps there was less urgency, but as Asia contemplates SPRs here and there, how can Japan afford to buy oil or other commodities at 121 to the dollar?