Anon on Nostr: ELI5: “They” say one of the primary contributing factors to this Bitcoin and ...
ELI5:
“They” say one of the primary contributing factors to this Bitcoin and equity selloff is the unwinding of the yen carry trade, that is to say, the differential between USD and JPY rates just narrowed due to an increase of the JPY rate, and people are selling risk assets to pay back their yen loans. Fair enough.
If that’s true though, wouldn’t the lowering of USD rates also cause a narrower spread? Yet lowering the USD rates is widely seen as positive for risk assets. The topic of the “carry trade” never seems to come up in the context of lowering US rates. Why is that?
#asknostr #bitcoin LynAlden (npub1a2c…w83a) #macroeconomics
“They” say one of the primary contributing factors to this Bitcoin and equity selloff is the unwinding of the yen carry trade, that is to say, the differential between USD and JPY rates just narrowed due to an increase of the JPY rate, and people are selling risk assets to pay back their yen loans. Fair enough.
If that’s true though, wouldn’t the lowering of USD rates also cause a narrower spread? Yet lowering the USD rates is widely seen as positive for risk assets. The topic of the “carry trade” never seems to come up in the context of lowering US rates. Why is that?
#asknostr #bitcoin LynAlden (npub1a2c…w83a) #macroeconomics