The swoon in equities, perhaps sparked by a rotation spurred by potential US tax changes, is continuing today. It is providing a risk-off mood, which is expressed in the foreign exchange market as a stronger yen. The most compelling answer of yen strength is not that investors are buying yen as a haven. Japanese stocks are among the worst of the major markets over the past five days, ensured by today's nearly 2% drop by the Nikkei. Nor, of course, are Japanese interest rates attractive. Rather the yen's strength reflects unwinding trades use the yen to finance the purchase of other assets, like equities. As the ... (full story)