Sunday, Nov 15, 2009

China accuses US of fuelling ‘huge carry trade' through low rates

FT: China says Fed policy threatens global recovery

The US Federal Reserve is fueling “speculative investments” and endangering global recovery through loose monetary policy, a senior Chinese official warned. The combination of a weak dollar and low interest rates had encouraged a “huge carry trade” that was having a “massive impact on global asset prices”. [Japan's carry trade wasn't a problem for the rest of the world, because the Yen was never a global reserve currency. A dollar carry trade is blowing bubbles everywhere - credit markets, stock markets, oil, gold, even house prices. How long can it last?]

Posted by drewster @ 10:04 PM (746 views)
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1. inbreda said...

How long can it last?]

IMO probably a very long time. Just see how much longer the housing bubble lasted, long after most people on here recognised it as a bubble.

Monday, November 16, 2009 10:06AM Report Comment

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