Asia is overpricing risk (update 6) - Fed may disappoint re: QE. Japan may not intervene re: YEN

'Smart' money has poured into risk currencies (although stocks are sell/range trade) and YEN crosses on 2 reasons. 1. Bernanke speech. 2 BoJ/Gov intervention on the rising YEN.

Both reasons may disappoint:

• The Fed may, yes surprisingly and discreetly, be concerned about inflation spikes. So any further qualitative easing expectations may disappoint.

• The BoJ/Japanese Gov may not intervene on the YEN due to the Swiss National Bank losses when the SNB intervened on Swiss Franc appreciation v's EUR and took a billion dollar hit. Plus China will buy YEN to keep the YEN higher, think of it as a FX trade war between China and Japan re: export competitiveness

Tasty...