Cross-asset regimes

The quadrant idea

A regime quadrant takes two macro factors and plots their current state as a single point on a 2x2 grid. Each quadrant is a named regime; transitions between quadrants are signal. The visualisation forces you to think about the joint state rather than two independent reads, which is usually how the macro environment actually behaves.

YENCARRY, yen carry quadrant

The YENCARRY panel plots two factors driving the yen carry trade, the global risk-asset trade where USD (or JPY) borrowed cheaply funds higher-yielding assets including crypto:

• USDJPY direction, strengthening yen (USDJPY falling) tends to unwind carry trades. Risk assets including crypto sell off as funding-currency strength forces position closes.
• Rate differential, the spread between BoJ and Fed policy rates. Wider differential = more carry available = more incentive for the trade. Narrowing differential = unwind pressure.

The four quadrants:

• Carry on (weakening yen + wide spread) = carry trade actively building. Risk-asset tailwind.
• Carry tension (strengthening yen + wide spread) = early warning. Carry economics intact but yen strength suggests positioning is starting to unwind.
• Carry unwind (strengthening yen + narrowing spread) = active unwind. Risk-asset headwind.
• Carry rebuild (weakening yen + narrowing spread) = transition zone. Spread narrowing reduces incentive but yen weakness suggests trade rebuilding.

MACROREG, macro regime quadrant

The MACROREG panel is the broader cousin: a quadrant of growth vs inflation, the standard "macro 2x2" that allocators use to position across asset classes. The four quadrants:

• Reflation (growth up + inflation up) = risk assets win, equities and crypto rally, commodities run.
• Goldilocks (growth up + inflation down) = ideal regime. Equities make new highs, crypto compresses and rallies.
• Stagflation (growth down + inflation up) = worst regime. Risk assets bleed, gold runs, crypto uncertain.
• Disinflation / slowdown (growth down + inflation down) = bonds rally, equities depend on Fed response, crypto correlates with the Fed pivot expectation.

The current quadrant is plotted as a moving point with a history trail showing how the regime has evolved over the last N months. Sharp moves between quadrants are when allocators rebalance, which is often when the biggest cross-asset rotations happen.

How to use them

Quadrant panels are best read as orientation, they tell you what kind of macro tape you're in. They're terrible for entry signals (the position in the quadrant tells you nothing about the next minute's price). Use them to size correctly: in "Goldilocks" you can press long beta; in "Stagflation" you size down.