Comments on: The November TIC data: Matching debtor and creditor side data http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/ Thu, 14 Oct 2010 13:09:54 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: starting a day care http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72739 starting a day care Tue, 10 May 2005 08:54:13 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72739 <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">day care</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">starting a daycare</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">daycare business</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">daycare business guide</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">daycare</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">starting a day care</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">opening a day care</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">how to start a day care</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">starting a daycare</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">home-based business</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">daycare startup guide</a><br> <a target="rgenew" href="http://bargainfrt.daycare.hop.clickbank.net/">http://bargainfrt.daycare.hop.clickbank.net/</a> day care
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]]> By: Mike http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72738 Mike Thu, 20 Jan 2005 11:37:05 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72738 I guess the forward market is so deep that it cannot be identified who is taking the other side. If it is the banks then they will lay the risk on to someone else. Ig Japanese investors are buying dollars spot and selling dollars forward then it might be the case that corporates are selling dollars spot and buying dollars forward as part of their trading operations. No one need have an outright position. I guess the forward market is so deep that it cannot be identified who is taking the other side. If it is the banks then they will lay the risk on to someone else. Ig Japanese investors are buying dollars spot and selling dollars forward then it might be the case that corporates are selling dollars spot and buying dollars forward as part of their trading operations. No one need have an outright position.

]]> By: brad http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72737 brad Thu, 20 Jan 2005 08:23:58 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72737 mike -- good point, my sense too. My standard question though: who supplies the hedge and takes the dollar risk the Japanese do not want? mike — good point, my sense too. My standard question though: who supplies the hedge and takes the dollar risk the Japanese do not want?

]]> By: Mike http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72736 Mike Thu, 20 Jan 2005 03:56:46 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72736 Japanese investors have been heavy buyers of hedged US fixed income securities. Although Anne is correct that they take on US price risk, the fact that Asian central bank buying is placing an effective cap on US long-term rates takes out some of the risk of that trade. Asian intervention's impact on the US bond market goes way beyond the direct flow impact. It has altered the behavior of all investors in the US market from those who are involved in curve flatteners to US banks' securities investments to US investors who have moved into spread products. For the moment their intervention has removed perceived price risk in US long term securities, which is a dangerous thing as we learned back in 1998. Japanese investors have been heavy buyers of hedged US fixed income securities. Although Anne is correct that they take on US price risk, the fact that Asian central bank buying is placing an effective cap on US long-term rates takes out some of the risk of that trade. Asian intervention’s impact on the US bond market goes way beyond the direct flow impact. It has altered the behavior of all investors in the US market from those who are involved in curve flatteners to US banks’ securities investments to US investors who have moved into spread products. For the moment their intervention has removed perceived price risk in US long term securities, which is a dangerous thing as we learned back in 1998.

]]> By: anne http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72735 anne Wed, 19 Jan 2005 16:14:51 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72735 http://www.j-bradford-delong.net/movable_type/2005-3_archives/000195.html#comments Am I a Secret Austrian? Though I have read Tyler Cowen's point several times, I am not sure what to make of them. Is federal debt of not concern even in an economy with low levels of household saving? Is foreign debt of no consequence? What am I missing? http://www.j-bradford-delong.net/movable_type/2005-3_archives/000195.html#comments

Am I a Secret Austrian?

Though I have read Tyler Cowen’s point several times, I am not sure what to make of them. Is federal debt of not concern even in an economy with low levels of household saving? Is foreign debt of no consequence? What am I missing?

]]> By: bill http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72734 bill Wed, 19 Jan 2005 11:45:41 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72734 Mike- The trade you describe exposes the buyer to price changes on the Treasuries purchased. If ten year Treasury yields increase during holding period, investor loses from price depreciation. It's much cleaner for a foreign buyer who likes the carry in US interest rates, but not the currency exposure, to buy futures or interest rate swaps. In any case, buyer is taking a long position in US bonds, an example of private foreign buyers supporting low US interest rates. Mike- The trade you describe exposes the buyer to price changes on the Treasuries purchased. If ten year Treasury yields increase during holding period, investor loses from price depreciation. It’s much cleaner for a foreign buyer who likes the carry in US interest rates, but not the currency exposure, to buy futures or interest rate swaps. In any case, buyer is taking a long position in US bonds, an example of private foreign buyers supporting low US interest rates.

]]> By: anne http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72733 anne Wed, 19 Jan 2005 10:41:02 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72733 http://www.j-bradford-delong.net/movable_type/2005-3_archives/000195.html#comments Am I a Secret Austrian? I can only plead that my Austrian tendencies are small and (usually) under control. Most of the time I'm a straightforward Keynesian aggregate-demand guy: i.e., get the level of aggregate demand right and most other problems will go away. But the U.S. fiscal deficit, its reflection in the balance of trade, and the... interesting policies of Asian central banks produce problems that cannot be analyzed as either too much or too little aggregate demand. The Austrian theoretical framework thus seems to be the only tool at hand. And when all you have is a hammer... http://www.j-bradford-delong.net/movable_type/2005-3_archives/000195.html#comments

Am I a Secret Austrian?

I can only plead that my Austrian tendencies are small and (usually) under control. Most of the time I’m a straightforward Keynesian aggregate-demand guy: i.e., get the level of aggregate demand right and most other problems will go away. But the U.S. fiscal deficit, its reflection in the balance of trade, and the… interesting policies of Asian central banks produce problems that cannot be analyzed as either too much or too little aggregate demand. The Austrian theoretical framework thus seems to be the only tool at hand. And when all you have is a hammer…

]]> By: brad http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72732 brad Wed, 19 Jan 2005 10:31:12 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72732 Mike. good point. who is selling the hedge, and taking the dollar exposure the european/ japanese investors do not want? When Asian central banks buy, they take the dollar exposure. Am curious who is taking the ultimate dollar exposure on the private side. Mike. good point. who is selling the hedge, and taking the dollar exposure the european/ japanese investors do not want?

When Asian central banks buy, they take the dollar exposure. Am curious who is taking the ultimate dollar exposure on the private side.

]]> By: Mike http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72731 Mike Wed, 19 Jan 2005 10:17:42 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72731 Given that the US yield curve is steeper than the Euo and JGB yield curves, it is attractive for European and Japanese investors to purchase US fixed income securities and hedge the associated dollar exposure back into euros and yen. The yield pick up on a 3 or 6 mth rolling basis is an annualized 50 basis points--a meaningful amount in todays low yield environment. The point here is that foreginers could be buying a lot of US securities on a hedged, and not on an unhedged basis. Thus it has no FX impact. Given that the US yield curve is steeper than the Euo and JGB yield curves, it is attractive for European and Japanese investors to purchase US fixed income securities and hedge the associated dollar exposure back into euros and yen. The yield pick up on a 3 or 6 mth rolling basis is an annualized 50 basis points–a meaningful amount in todays low yield environment. The point here is that foreginers could be buying a lot of US securities on a hedged, and not on an unhedged basis. Thus it has no FX impact.

]]> By: bill http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72730 bill Wed, 19 Jan 2005 08:59:18 +0000 http://blogs.cfr.org/setser/2005/01/18/the-november-tic-data-matching-debtor-and-creditor-side-data/#comment-72730 s- I agree with your observation about the UK, but I think the losses they suffered to their capital base--human, financial and physical-- from fighting two World War may have had more to do with their dowgraded status than current account deficits and low savings rates. s- I agree with your observation about the UK, but I think the losses they suffered to their capital base–human, financial and physical– from fighting two World War may have had more to do with their dowgraded status than current account deficits and low savings rates.

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