$-Yen carry trade busts and Yen gains rapidly sending Japanese economy in a downhill.

 

Calamity Reading 70%.

August 1998 US Reacts To Russian Crisis;
Hedge Funds get into trouble when a flight to cash follows the Russian Debt Crisis, and a re-pricing of Risk takes place. The Bank of New York puts in place a rescue package to limit the fear of Hedge Funds failing. The Dow Jones drops 500+ points on the above news, the Asian crisis, and on the same day a misille strike by North Korea that sends three missiles over Japan. All is not well in the world. Calamity Reading 80%.

April 2000 Internet Bubble Bursts;
The Dow Jones tumbles over 600 points, the second largest drop on record, at the same time the Nasdaq drops 355 points, or nearly 10%. The Nasdaq goes on to lose 1000 points in the week’s trade, and ends up off 34% from the all-time high set just one month before. The Internet companies that IPO’d and ran higher give back virtually all of their values, some are reduced to absolutely nothing and are de-listed. Calamity Reading 90%.

September 2001
The NYSE opens to a 684 point slide, the largest ever one day move, but a base is quickly found. The Government and the Federal Reserve step in to support the economy. A tragic event that neither loss of money, nor assets, can really compare to. This puts in perspective what loss is really all about.

July 2007 US Sub-Prime Valuations Announced;
In the first that many had publicly heard of it, the rating agencies Standard and Poors, and Moody’s, downgrade the LDO and CDO packages that contain the Sup-prime mortgages that were issued in the insatiable appetite that the US had to own a house. Good loans, bad loans, terrible loans, and average loans were bundled together and sold as good debt to Mutal and Hedge Funds. Once the downgrades were issued by the rating agencies the debt could not be held by many Funds, they could not sell them, and as such started to write-off their values in a move that decimated many balance sheets.

The Federal Reserve wait until September to cut Rates, after waiting more than a year to cut, and then go on to shave 275 Basis Points from US Rates in quick time. The knock-on effects reduce GDP growth numbers and create a run on the US Dollar. Emergency Stimulus Packages are introduced, and the economy hunkers down for a rough ride. Calamity Reading ?%.

Yen Carry busts as Mrs Wantable has no more Yen to export anymore.