Gold prices have surged this morning to their highest since October (over $1221) as leveraged hot money greatly rotates its repo-driven way out of risk assets and into Greenspan's alternative currency. However, there is a bigger problem for the biggest pairs trade that no one is discussing - apart from us -the decoupling of the long Nikkei, short gold trade as the repo market folds in on itself from the suck out of $80 billion in collateral by China...
Gold back at its highest since October...
and the Gold/Nikkei trade is coming undone very quickly...
Charts: Bloomberg
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