Do you remember the ?Cash for Clunkers? program enacted by the U.S. government to help the U.S. Car industry? It offered a generous cash rebate to car buyers who traded in their old car.
While there were lots of cars sold during Cash for Clunkers, all it did was pull sales from future months. Everyone who thought about buying a car in the next 3 months pushed the car purchase forward to get a check from the government.
(Click charts to expand)
Car sales plummeted after ?Cash for Clunkers?
How does this relate to G-7 interventions in the yen? Anybody who is thinking about buying yen in the next few months will want to do it when there is a huge Government program selling yen. Why wait and potentially lose another 5%?
My view on Bank of Japan (BoJ) intervention in the yen is that it is more likely to
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