US bond markets take fright at European debt disease
The decision by the German government to ban naked shorting of sovereign bonds and CDS and some financial stocks triggered a collapse in confidence among US investors in all but the safest domestic names this week.
Hedge funds holding bank credit have been worst hit, said traders, but a week that started with regulatory intervention in Germany ended with an unwinding of dollar-funded carry trades as investors moved money into dollars and yen.
The unwinding of positions in Australian and Canadian dollars was heavier than
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