Why Japanese markets have plummeted
Global panic has continued to take hold of financial markets around the world as fears of an American recession spread.
Heightened market tension comes as Japan’s Nikkei 225 index dropped 12.4 per cent on Monday – the biggest decline since the Black Monday crash in 1987.
CNN Business Journalist Richard Quest joined Sky News Australia to discuss why the Japanese market plummeted as investors dumped a wide range of shares.
“This is where in a lower interest rate economy you borrow money against the yen, but you invest it in dollar-weighted assets, thereby known as the carry trade,” Mr Quest said.
“Now the problem is if the end suddenly appreciates, and you suddenly find yourself on the wrong side of the carry trade.
“You have to sell those US dollar assets, and that’s what we’re seeing at the moment. So, it’s not surprising.”
10 Comments
Europe is screwed.
How do most of you guys still make profit, even with the downturn of the economy and ever increasing life standards
Kamala Harris this is your mess with YOUR name on it.
This man is a ungodly human wait til it all falls to user in the digital beast system this epic lies of man about to be known and all will see wait til 31/2 years when antichrist is seen in his true form!!!
❤From $37K to $65K that's the minimum range of profit return every month I think it's not a bad one for me, now I have enough to pay bills and take care of my family.❤
Sky News has a cnn journalist on weird that after they cry about them non stop .
Heard about Japan already from reliable sources. Off for real news, again and truth
Can Kamala count in the passage of time?
Japan closed at 10% up, today!
When you give free reign to hedge funds to play UNMITIGATED…..this is the end result.
Hedge fund uses other people’s monies to gamble…..
Which hedge fund will play safe ?
They piled into the carry trade …..and piled into Japanese stocks.
Once the BOJ raise int rate …and the Fed threaten to raise int rate ….IT UNWINDS.
……and SHIT HAPPENS.