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Sustainable?

Tyler Durden's picture





 

It is all too easy to look admiringly at levitating nominal stock prices, stick your head in the sand, and believe that Abe and Kuroda have it all under control (by "it" we mean everything that has happened and that Zero Hedge predicted would happen two years ago). But for those unwilling to take the BoJ's word for it that "the economy has stopped deteriorating," we ask one simple question. After looking at the following four charts of Abe's 2-2-2-2 Plan, "is it sustainable?" You decide...

 

Abenomics: The "2-2-2-2" policy

+2% inflation in 2 years - by printing (and implicitly devaluing the currency on a scale we have not seen)... way beyond anything anyone has ever tried before...

 

Double monetary base and BOJ’s JGB holding

 

Double the average duration of JGBs the BOJ buys

 

And all this with a Structural deterioration in the extrernal balance...

 

 

All looks very doable eh? Now ask yourselves, do you feel lucky?

Sustainable?

Given the volatility in JGBs on the last 3 days, we suggest not. ..


 


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Tue, 04/09/2013 - 18:59 | Link to Comment francis_sawyer
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Even a 'Kardashian' could not possibly backstop what's to come...

Tue, 04/09/2013 - 19:14 | Link to Comment WayBehind
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Sustainable? Are you kidding me?! I mean, of course! To the moon!

Tue, 04/09/2013 - 19:42 | Link to Comment The Alarmist
The Alarmist's picture

Meh! Sustainable seems to have become a question of whether or not the proles are in the streets with torches and guillotines.  Don't see them yet, so things, as reported, must be sustainable, no?

Tue, 04/09/2013 - 19:42 | Link to Comment Ahmeexnal
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Seems like a shortage of Depends is about to develop in the land of the rising sun.

Wed, 04/10/2013 - 05:19 | Link to Comment mt paul
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stainability ...

 

japan just shot their load

Tue, 04/09/2013 - 19:51 | Link to Comment asteroids
asteroids's picture

I bet the FED and the ECB are watching very very carefully. If this experiment works, expect these money printers to go "full retard". I personally don't see how it can with all their debt. Printing money doesn't fix that.

Tue, 04/09/2013 - 21:21 | Link to Comment Quantum Nucleonics
Quantum Nucleonics's picture

I personally don't see how it can with all their debt. Printing money doesn't fix that.

 

But isn't that the whole point. Printing inflates away the debt problem.  They are killing two birds with one printing press.  They wipe out their debt with inflation, and smash their currency making their exports competitive.  Sure, their retired population will be eating cat food, or will be cat food.  Wait, that's three birds.  The sooner they get their demographic profile "right-sized", the better.

Tue, 04/09/2013 - 19:21 | Link to Comment toys for tits
toys for tits's picture

This is my kind of sticking heads in the sand.

http://i.imgur.com/JC0rTcq.jpg

Tue, 04/09/2013 - 23:45 | Link to Comment Rubbish
Rubbish's picture

By George, this is gonna work

Tue, 04/09/2013 - 19:24 | Link to Comment prains
prains's picture

Yes goddamnit Japan is unsustainably sustainable......unsustainably

Tue, 04/09/2013 - 19:01 | Link to Comment StarTedStackin'
StarTedStackin''s picture

Green shoots, recovery summer hope and change!!!!!!!

Tue, 04/09/2013 - 19:00 | Link to Comment nmewn
nmewn's picture

Confetti...weeeee!!!

Tue, 04/09/2013 - 19:03 | Link to Comment Dr. Engali
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Damn I forgot to check my gardens on FarmVille ...I bet everything died and I'll have to start all over. Just fricken great! ........Damn chart porn anyway.

Tue, 04/09/2013 - 19:09 | Link to Comment kaiserhoff
kaiserhoff's picture

Can you buy virtual food with bitcoins?

Tue, 04/09/2013 - 19:17 | Link to Comment WayBehind
WayBehind's picture

Virtual food & virtual money. What a great combo. We need more of those hahaha

Tue, 04/09/2013 - 19:21 | Link to Comment nmewn
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Kinda like EBT in a strip club...it just appears out of the ether...but its still kinda fishy ;-)

Tue, 04/09/2013 - 19:42 | Link to Comment The Alarmist
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I kind of got the impression that Bitcoin is ideal for hiring hookers/strippers.

Tue, 04/09/2013 - 21:25 | Link to Comment Pareto
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I finally said fuck the garden planting (kept dying) and built an oil refinery and a bunch of rigs.  That was forever ago.  Havent been back since.  A retarded waste of time.  Now i'm here.  Much more productive.

Tue, 04/09/2013 - 19:09 | Link to Comment Headbanger
Headbanger's picture

Assets!!??   We don't need no stinking assets!

http://www.youtube.com/watch?v=VqomZQMZQCQ

Great movie. Watch it.

Tue, 04/09/2013 - 19:26 | Link to Comment Goldilocks
Goldilocks's picture

You’ve got to ask yourself one question. Do I feel lucky? Well do you punk,,,

Classic Movie Line #31
https://www.youtube.com/watch?v=u0-oinyjsk0 (0:28)

Tue, 04/09/2013 - 20:53 | Link to Comment Iocosus
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Speaking of Japs and Clint Eastwood.....

 

https://www.youtube.com/watch?v=LeU-qDbKw68

Tue, 04/09/2013 - 20:53 | Link to Comment Iocosus
Iocosus's picture

Speaking of Japs and Clint Eastwood.....

 

https://www.youtube.com/watch?v=LeU-qDbKw68

Tue, 04/09/2013 - 19:52 | Link to Comment LeisureSmith
LeisureSmith's picture

Note to self: Learn how to dance like an old gold prospector. http://www.youtube.com/watch?v=3w4B7QxL_n4

Tue, 04/09/2013 - 19:08 | Link to Comment kaiserhoff
kaiserhoff's picture

What the banksters want is inflation in real estate to bail out their bad loans.

What they get is commodity inflation, which tanks the economy.  They keep repeating the same mistakes. Government debt will crush them all soon enough.

Tue, 04/09/2013 - 19:10 | Link to Comment Headbanger
Headbanger's picture

Ding ding ding ding ding!! 

We have a winner!

Tue, 04/09/2013 - 20:15 | Link to Comment 1000 splendid suns
1000 splendid suns's picture

Billyens and billyens and billyens!

Tue, 04/09/2013 - 19:14 | Link to Comment Hedgetard55
Hedgetard55's picture

Jap stocks are free money for anyone who wants it. All their wealth are belong to us. Fuck Mrs Watanabe, she is going to get fucked up the ass big time.

Tue, 04/09/2013 - 19:22 | Link to Comment toys for tits
toys for tits's picture

Nothing a little war won't solve.

 

Tue, 04/09/2013 - 19:15 | Link to Comment WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

Abe and Kuroda are breaking (Divine) wind in the general direction of China.

Tue, 04/09/2013 - 19:20 | Link to Comment Yen Cross
Yen Cross's picture

     I sounds really bad when we talk about it, but when I see it on paper/monitor I want to shit myself!  BoJ gone full retard...

Tue, 04/09/2013 - 19:26 | Link to Comment CDNX fan
CDNX fan's picture

Tyler - you have nuked me three times as a troll - I repeat my statement since 2010:

 

"NEVER underestimate the replacement power of equities (common fucking stocks, ETF's, E/S futures) within an INFLATIONARY FUCKING SPIRAL."

 

What is it about that statement that makes the ZH crowd go bonkers? Martin Zweig said it when Tyler was in Grade School. 

 

FUCK!

Tue, 04/09/2013 - 19:52 | Link to Comment razorthin
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You referenced "Martin Zweig".  There's that.  You endorse paper - there's that too.  Lastly, there is no shortage of geniuses, like your buddy Marty,  when the "market" is ascending.  A very small fraction of those geniuses avoid being wiped out with the next market wipe-out.

Shark bait.

Tue, 04/09/2013 - 20:32 | Link to Comment adr
adr's picture

SO I buy Chipotle, Netflix, and Amazon and become a trillionaire?

There were a lot of trillionaires in Zimbabwe. I bet a lot of people in Wiemar felt filthy rich pushing around wheelbarrows full of cash.

It doesn't matter if a share of stock is worth $1 billion on paper if there is nobody willing to give you something of worth for it.

One share of Chipotle might be worth $1 billion in dollars, but it would probably be worth about six atoms of gold.

Tue, 04/09/2013 - 19:27 | Link to Comment buzzsaw99
buzzsaw99's picture

25 bps in volatility is the author's evidence for unsustainability? lulz lulz lulz lulz lulz lulz lulz lulz lulz lulz lulz lulz lulz lulz lulz

Tue, 04/09/2013 - 19:29 | Link to Comment buzzsaw99
buzzsaw99's picture

I'm sure old abe will break a sweat when he hits infinity and beyond. lol

Tue, 04/09/2013 - 19:34 | Link to Comment Smuckers
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I like hockey sticks.

Tue, 04/09/2013 - 19:41 | Link to Comment gould's fisker
gould's fisker's picture

Don't worry, I have it from a creditable source that we will all be taken care of no matter what happens:

http://www.thesun.co.uk/sol/homepage/news/4764841/Why-work.html

Tue, 04/09/2013 - 20:09 | Link to Comment Clowns on Acid
Clowns on Acid's picture

Japan is taking the Krugman advice....if you own all the JGBs ....well you can just retire them. Then people only can equities....the stock maket goes up and you are wealthy.

The BoJ can do the Krugman platinum  coin for show if they like..... is just so easy....

Tue, 04/09/2013 - 20:21 | Link to Comment q99x2
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I wouldn't worry about it. BTFD. Nukes are going to fly tomorrow.

Tue, 04/09/2013 - 20:27 | Link to Comment ptoemmes
ptoemmes's picture

We seem to be lagging behind so channeling Schumer " ...Get to work Mr. Chairman."

 

/sarc

Tue, 04/09/2013 - 20:28 | Link to Comment adr
adr's picture

Just think of the equities to the moon stories when Toyota unveils the Trillion Yen car. Followed soon by the Quadrillion Yen Car.

I personally can't wait for Trillion Yen Sake.

I know people that can't wait for the Trillion Yen Happy Ending.

Wed, 04/10/2013 - 09:00 | Link to Comment Downtoolong
Downtoolong's picture

And if that doesn't happen, I'll be looking forward to the day when they're giving out free Toyota Camry's with every tank of gas.

Or maybe not.

 

Tue, 04/09/2013 - 20:55 | Link to Comment Tombstone
Tombstone's picture

We have seen how Benny's QE's have expanded the job market with about 100 million out of the work force.  So what's next for the socialists and central planners?  More QE and lots more welfare.  Throw O'bummercare into the mix and if we survive 2013, 2014 should be one heck of a ride; similar to a big time bull ride.  The only thing that suvives will be bull.

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