CHAPTER 6Weightless Waiting for the Deflation Descent
Way-back machines don’t just offer visions of the extremes. They set a framework for understanding reality. Simple pattern recognition can be right or wrong. Combined with logic and human reason, it is a powerful way to summon the muse. If inflation is fiery and vibratory, then deflation is cold and numbing. Get ready for an icy forecast.
DEFLATION AND CARRY TRADE: FROZEN EAST
A carry trade is a short funding currency, long target currency position that takes advantage of interest-rate differentials. Unfortunately, high interest rates typically go hand in hand with interest-rate and exchange-rate volatility, creating conditions for an unwind crash as the money heads out of risk and back home. ...