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

To: bond_bubble who wrote (66985)	7/28/2006 12:26:57 AM
From: bond_bubble	Read Replies (3) \| Respond to of 110194

Japanese trade surplus narrows in June: news.bbc.co.uk The surplus fell 5.9% to 807.9bn yen ($6.9bn) during the month, its first fall in two months. The country blamed a rise in oil and metals imports for the decrease, but added that exports remained resilient. ........... However, in recent years, its trade surplus has fallen as Japanese firms have moved production overseas, while raw material costs - in particular oil - have risen. Exports stood 14.4% higher than at the same time last year at 6.3bn yen, led by demand for vehicles, while imports rose 18.2% to 5.5bn yen. Note [BondBubble]: I've been saying that Japan and China can buy the US bond trash only as long as they have net trade surplus. Sooner or later, both China and Japan are going into trade deficit and the raw materials countries will have to start supporting the massive us trade deficit!! And these countries will not (Australia, Canada dont hold reserves)... I think trade deficits for China and Japan are not far off, and hence the expectancy of USD fall increases. To prevent it Fed is going to keep increasing the interest rate no matter what... (I expect a pause after August - but a resumption to hike by the end of the year)

To: bond_bubble who wrote (66985)	7/28/2006 7:27:48 AM
From: russwinter	Respond to of 110194

I'm not sure about the Euro, but there has been a bunch of carry trade shorting of the yen. The yen could witness a large unravelling short covering rally, probably tied to more hikes or a significant yuan revaluation. More Japanese inflation reported last night. That's eight straight months of this, and these flat earthers still refer to it as "beating deflation". Reminds me of the real estate "soft landing", "buyer's market" spin and rectification. bloomberg.com Japanese companies have started transferring costs to consumers as costlier oil and raw materials squeeze profits and wage gains make it easier for consumers to accept higher prices. Oji Paper Co., Japan's largest paper producer, on July 21 raised wholesale prices of tissues and paper towels by as much as 30 percent to reflect higher crude-oil costs.