A major reversal is unfolding

The US dollar and US bond yields screamed higher on fears about Trumps tariffs and tax cuts.
But now that he is in power the market is reassessing their fearful response. Are we about to see a sharp reversal in the fortune of both?
What will happen if bonds rally and the US dollar gets hammered?
Murray explains what could unfold and shows you that the Japanese Yen carry trade is still something that could unsettle tech stocks down the track.
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[@rvajna]

It's a good time for junior gold companies to be going into production. If they can't make it now then they never will.

[@chrischong6211]

When Yen carry trade unwind, Yen should go up in value. Borrowers of Yen to buy foreign assets will have to sell foreign assets, convert the foreign currencies to Yen ie buy Yen and that will cause Yen to go up.

[@murraydawes7851]

@@chrischong6211 that’s what I said. The chart is the USD vs the Japanese Yen. So when the chart is going down it’s saying the USD is going down and the yen is going up.

[@chrischong6211]

@@murraydawes7851 Yes US$ going down against the Yen means the Yen is going up. This should happen when Yen carry trade unwind. Japan is printing money to fund the western nations debt. In doing so they suffer deflation all the time. Bank of Japan is facilitating deflation by keeping the interest rate low but he reversed the argument by saying he kept interest rate low because he is afraid of deflation. Japanese industries are underinvested for decades due to the Yen carry trade as money moved out of the country. BOJ had destroyed the aspirations of young Japanese who are still very innovative, hardworking and clever.

[@R420-h3z]

I love these closing bells mate- religiously watched at my place

[@williamthomson5882]

Best analysis around bar none

[@JohnWalker-pc8qm]

Good calls Murray

[@peterjankowski91]

Great ideas, thanks

[@rosspartridge7976]

Well explained

[@TonyJohn-2]

That was really good thanks Murray. Very helpful. With gold soaring and oil under pressure this might be the start of a very bullish period for gold stocks. Buckle up and hold on maybe?

[@markblacker1259]

Thanks Murray, another terrific Closing Bell analysing the macro picture.