The Rise of Carry: The Dangerous Consequences of Volatility Suppression and the New Financial Order of Decaying Growth and Recurring Crisis

Preface and Acknowledgments

THE AUTHORS BEGAN WORK ON THIS BOOK ABOUT FIVE years ago. The original motivation was partly frustration with the inadequacy of standard explanations of how central banks’ unconventional monetary policies had supposedly been working to support the economy since the global financial crisis. We recognized that the key was the suppression of financial volatility that the interventions of central banks and governments have engendered. This has become much more obvious over the years since we began to work on this book. But the full implications of the growing dominance of carry trades have yet to be understood.

From a purely financial perspective, the book contains a number of insights. Among the most important are the ...