Courtesy of EconMatters
We look at the funding currencies for the risk on versus risk off mode of evaluating financial market capital flows from an investing standpoint. You are swimming upstream in a Carry Unwinding Mode like a Salmon. Check out the main components of the US Dollar Index and compare their interest rates versus the United States. This serves as the fundamental basis for the Carry Trade Structure, and we have seen major deleveraging of these Carry Trades before the Presidential Election this upcoming Tuesday. Look for these trends to reverse after the election event is over with next week.
