Time to shine a light on the shadowy carry trade
Transparency will help to avoid financial blow-ups
Soon after markets tumble, the search for the culprits begins. Choppy trading over the past two weeks has put a dent in stock prices globally, while safe government bonds have rallied. Concerns about the health of America’s economy and its expensive tech stocks are part of the explanation for the surge in volatility. Analysts and investors have identified another culprit behind the tumult: the reversal of opaque “carry trades”, particularly in the Japanese yen.
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This article appeared in the Leaders section of the print edition under the headline “Billions or trillions?”
Leaders August 17th 2024
From the August 17th 2024 edition
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