EPISODE · Feb 24, 2022 · 1H 6M
Carry Trades and Volatility Shocks
from Dantes Outlook Market Podcast · host Tim Lee, Damanick Dantes
Tim explains that carry trades (borrowing at low interest rates to finance higher-yield investments, and assuming market stability), are behind recurring booms and busts. Tim and his fellow authors argue that market crashes are not the result of economic recessions – rather, market crashes cause recessions. Currently, there is risk of another carry crash, which was in development before the Russia-Ukraine crisis. The information presented is for informational purposes only and should not be considered as investment advice nor as a recommendation of any particular strategy, allocation or investment product: before making any investment decision, you should seek expert, professional advice and obtain information regarding the legal, fiscal, regulatory and foreign currency requirements for any investment according to the laws of your home country and place of residence. Investing involves risk, including the possibility of loss of principal. Any forward-looking statements or forecasts are based on assumptions and actual results may vary from any statements or forecasts.Visit us at www.dantesoutlook.com
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What this episode covers
Today, we’re talking about volatility. It’s well known that markets ebb and flow, but over the past 25 years or so, there has been a pattern of spectacular rises and crashes. And that comes at the expense of decaying economic growth and central banks becoming the leaders of last resort. To understand why this is happening, we turn to Tim Lee, the author of The Rise of Carry.
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Carry Trades and Volatility Shocks
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