GO
Loading...

Art Cashin: Dollar Carry Trade Could Cause Big Pullback

Markets opened slightly higher on Tuesday after encouraging reports on housing, earnings, and as the U.S. dollar retreated. Art Cashin, director of floor operations at UBS Financial Services, shared his insights.

“This particular debate as to whether this is really a bull market moving along or where things are going? Some of the brightest minds in the business are on opposite sides and arguing vehemently,” Cashin told CNBC.

“You usually don’t get that.”

He said if people continue to use the dollar as a carry trade and if the trade begins to unwind, investors will have to “scramble to cover their shorts in the dollar.”

CNBC Data Pages:

“That could lead to a kind of chain reaction and that could lead to a bit more than a 10 percent pullback,” he said.

“If it were to be a chain reaction, it would be sharp and sudden—a little bit of what we saw yesterday (Monday).”

Market Point/Counterpoint:

______________________________
CNBC Slideshows:

______________________________

______________________________
CNBC's Companies in the News:

Goldman Sachs

  • 'Dark Pools' Help Investors: Goldman Sachs

General Electric*

  • Vivendi CEO Says IPO an Option for NBC Universal

UBS

AIG

Berkshire Hathaway

*GE is the corporate parent of CNBC.

______________________________
Disclosures:

No immediate information was available for Cashin or his firm.

______________________________

Disclaimer