Good morning. What looked like a recovery in US stock markets yesterday became a decline by the end of the day. Whatever problem we have been having, we are still having it. Send us your diagnosis: robert.armstrong@ft.com and aiden.reiter@ft.com.

The carry trade reconsidered

Everyone loves a simple phrase that covers a complex phenomenon — even more so if it sounds a bit sophisticated. Enter “the carry trade”, or, even better, “the unwinding of the carry trade”, which have been rolled out as an explanation for all sorts of market chaos in the past week or so.

We’ve written that we see no evidence that the volatility in US equities, in particular, results from the carry trade. It seems more likely that causality runs in the other direction. After talking to people who understand currency markets and Japanese finance better than we do, we still think this.