Back in September, a sea change occurred in the global currency markets that you need to know about. For the first time since 1993 it suddenly became cheaper to borrow dollars than Japanese yen. Global central bank rates are part of the LIBOR statistics that are published daily in London, the global center for currency trading and interbank lending. This may not be a piece of data that you as an individual investor will follow everyday, but you can bet that the world’s central banks, investment banks, sovereign wealth funds, institutional traders and hedge fund managers pay a great deal of attention to it.

As you may remember from the financial crisis of 2008, larger financial institutions tend to be leveraged; some are leveraged on the order of 20:1 or more. This means that incremental differences in interest rates paid for borrowed capital vs the return on the capital, can make huge contributions to the bottom line.
 
The world’s deep-pocketed players need to borrow and, like bees to a pollen-laden flower, they swarm to the particular central bank that is offering the lowest short-term funding rates. Right now, that flower looks like a daisy with Ben Bernanke’s smiling face in the middle. Picture that.