By Jason B. Leach of Cravens Brothers Wealth Advisors (via Doug Short) (Guest Post)
On May 16th, we published a piece discussing the correlation between the S&P 500 and the Yen carry trade currency crosses. You can see the original post here. The gist of the original piece (illustrated in Figure 1) was: (i) the S&P 500 had been highly correlated with the AUD/YEN and EUR/YEN currency crosses for years (I used them as pre- and after-market forward indicators of S&P 500 moves), (ii) these correlations diminished significantly during Federal Reserve “quantitative easing” periods, and (iii)…
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