Most client interest has centered on the scenario of a technical default. This is an ultra low delta event, but so highly disruptive that it is forcing all participants to think the unthinkable. The closer we get to this kind of scenario, the more we would expect the world to divide into 1) a flight to safe haven currencies, with JPY, CHF, EUR, and GBP preferred in that order. The sharp divergence in long EUR and short JPY positioning suggests the yen will benefit the most from any position squeeze with a USD/JPY revisit of Y90 not impossible as EUR/USD heads to 1.40; and, 2) an exit out of growth sensitive commodity ... (full story)