DKK (Danish Krone)
Posted: Wed Aug 22, 2012 8:21 amThe Next Billion-Dollar Trade (You Won’t Guess Where It Is)
So I think the odds of Denmark’s euro-peg cracking are much more likely than “the experts” think.
The reason is that big speculators can bet on the euro-peg cracking for very little cost – by simply buying the Danish krone and shorting the euro.
http://www.thestockenthusiast.com/opini ... ere-it-is/
Denmark is fighting all this money coming into the country – for the purpose of maintaining a pegged exchange rate to the euro.
To keep its currency pegged to the euro, Denmark’s central bank is doing two things…
1) The central bank has cut interest rates in Denmark to below zero. (Yes, interest rates are negative in Denmark, discouraging people from putting money there.) So now, in Denmark, cash in your mattress is better than cash in the bank. Unbelievable!
2) The central bank of Denmark is selling kroner and buying euros. Denmark’s foreign currency reserves have more than doubled since 2008, hitting a record-high last month (and the month before that… and the month before that). It’s foolish and crazy that the central bank is selling its good currency (the krone) to buy a junk currency (the euro).
So I think the odds of Denmark’s euro-peg cracking are much more likely than “the experts” think.
The reason is that big speculators can bet on the euro-peg cracking for very little cost – by simply buying the Danish krone and shorting the euro.
http://www.thestockenthusiast.com/opini ... ere-it-is/