Are you sure that there are not a few Japanese houswives losing money on this game too? If it's such a no brainer then why is everybody not doing it - at which point any advantage would presumably disappear? Are you aware of the link between interest rates and currency value?If one were to borrow 15K from Halifax, you could easily whack inflation in the carry trade, by repaying at 6.9% and getting 17% from Istanbul.
The world won't explode if you allow a little bit of duplicated discussion
Not really interested in paying a middleman. If the Brazilian gov't doesn't want to borrow money from me personally, they can just pay up to the middleman between them and the lender.
I'd be happy to accept a 15% rate from them, but because they insist on going through middlemen, they have to pay 17.5%.
I think I know why their country's so poor.
Perhaps the Brazilian government is unaware of your willingness to lend to it at 15%. Why don't you call the ambassador and put your plan to improve his country's prosperity to him?
Why even talk to the ambassador? Sure he's only a middleman for the President ...
Are you saying I'm the only guy on Earth who'd jump at the chance of 15% returns? I doubt it.
Are you saying I'm the only guy on Earth who'd jump at the chance of 15% returns? I doubt it.
No, the poor Italian retail customers loved the wonderful returns that Argentina were providing a few years back and the banks loved selling it and as we all know countries don't default!
Yeah, but that's really the investor's look-out. No business of the bond issuer. Unless he feels that non-institutional money has cooties.
A bond purchase isn't necessary to play the carry trade. Rather than sitting on the sidelines cribbin' and moanin' about the small investor being excluded from the bond market why not play the currencies market via Oanda?
Because Oanda ain't what I have any interest in. Broken things are far less likely to be fixed if nobody complains, and Brazil's broken on many many levels. . . .Brazilian kids are dying in hospitals right now for lack of funds, and Brazil's leaders think they can afford to be choosy about who they borrow from?
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