"Those Who Believe In Abenomics Are Suffering From Amnesia"

Tyler Durden's picture


When shown the magnificent run-up in Japanese equities over the past six months and asked why he is skeptical about the likely success of Abenomics, Mizuho's chief economist simply explains, "because I am not suffering from amnesia," as the rest of the market appears to be. He goes in this brief interview with the FT to explain there is nothing new here. We already saw massive fiscal expenditure in the 1990s (which failed to gain any real economic traction) and as far as quantitative easing, Ueno reminds his interviewer, we saw major QE between 2001 and 2006 (that failed), Furthermore, the so-called growth strategy, "every Japanese cabinet has undertaken such doctrines without any success." The discussion then switches from the dashing of hopes to the risks of the policy. Five minutes well spent this weekend to remind your momentum-driven recency-biased anchored view of the world that there is nothing new under the sun and moar is not always better...


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Sat, 05/25/2013 - 20:16 | 3598961 CrashingDollars
CrashingDollars's picture

When it blows up I'll be in my solid gold lawnchair watching the fireworks

Sat, 05/25/2013 - 20:50 | 3598992 maskone909
maskone909's picture

And i will be at walmart stealing big screens.... Fuck yeah time to take back whats ours

Sat, 05/25/2013 - 22:58 | 3599145 DIgnified
DIgnified's picture


I'll be back for tall kitchen bags!

Sun, 05/26/2013 - 06:44 | 3599405 Doña K
Doña K's picture

The BOJ and Abe san, need a bucket of cold water on their heads and an intence deja vous moment 

Sun, 05/26/2013 - 11:01 | 3599655 Hulk
Hulk's picture

The whole fucking world needs a bucket of cold water on their heads. The entire place has gone mad, mad, mad I say !!!

Sat, 05/25/2013 - 20:52 | 3598996 Hedgerow-
Hedgerow-'s picture

When it blows up, I won't be in my solid gold lawnchair, I doubt I can even afford a solid gold goblet.

But I surely will be raising a glass to celebrate that this amnesia is over and the nightmare for some is about to begin.

Sat, 05/25/2013 - 20:59 | 3599003 maskone909
maskone909's picture

Here is a tip home boy. If you can afford a 12 gauge... Just head down to your nearest lending institution and ask to "borrow" their gold inventory! No need for a FICO score ect. Then proceed to enjoy your gold goblet...chalice... Olde english gold 800 brand or whatever your preference ;)

Sat, 05/25/2013 - 20:55 | 3599001 Burt Gummer
Burt Gummer's picture

Yen will be trading 200:1 to the USD sooner than most think.



Sat, 05/25/2013 - 21:07 | 3599015 maskone909
maskone909's picture

I fuckin hope so. Got stoped out friday fuckin WEAK!! had my stop at 100.77 and went to 100.73ish aint that some bullshit! Arrgggg god damn i wish i got into currencies 6 months ago. My bond short is nice tho long JGBD vol pickin up nice should see a golden cross soon. Once the jgb10y creeps past 2.3 the flood gates will forever open and thats a rap

Sat, 05/25/2013 - 20:46 | 3598962 knukles
knukles's picture

Off with his head!
Let him be sold as a comfort woman for American GI's!


It's different this time, I say, these new Honest Abe-Enomics

PS  Talking about amnesia, did you all see that Penny Pritzger, Billionairess Extraordinaire and Bundler for Obama, Commerce Secretary Nominee under-reported her income by $80,000,000?

Sat, 05/25/2013 - 21:05 | 3599013 Terminus C
Terminus C's picture

If she hadn't under-reported, do you think she'd be a nominee for Commerce Secretary?

Come on man, that shit's a resume point.

Sat, 05/25/2013 - 20:22 | 3598965 Hopium Dealer
Hopium Dealer's picture

I wonder how many time the Japanese bond market will be halted this week? I bet 2 times minimum for next week.

Sat, 05/25/2013 - 21:17 | 3599035 disabledvet
Sun, 05/26/2013 - 08:41 | 3599486 Urban Redneck
Urban Redneck's picture

If the FED were to actually take the Monday holiday off we could get two halts before the US week even starts... 

Sat, 05/25/2013 - 20:23 | 3598966 q99x2
q99x2's picture

Those are great chairs they were sitting in. We have those at the college library. I'm going to have to get me one soon.

Sat, 05/25/2013 - 20:30 | 3598969 toadold
toadold's picture

I'm shocked, I tell you, shocked that an economists would refer to actual historical results of central bank economic polices. He's a heretic! Cancel his diploma! .....Gather the Keynesians at the chapel. Have them bring a stake and firewood.  

Sat, 05/25/2013 - 20:47 | 3598988 knukles
knukles's picture

Quick, the Holy Water!

Sat, 05/25/2013 - 22:15 | 3599100 toadold
toadold's picture

Holy water is starting to get expensive.  I had to settle for a 5 liter box of Chateau de Plonk from Wally World. 

Sat, 05/25/2013 - 20:45 | 3598979 HulkHogan
HulkHogan's picture

I can't understand this guy. What the hell did he say? ...Fucking British accent.

Sat, 05/25/2013 - 20:44 | 3598981 maskone909
maskone909's picture

I have a fucking GED. I never went to business school.
However, it is clear as day that this can not go any further. This is a scam!! What the fuck is wrong with people?!?!?! Why does most economies have a central banking structure? Who is running the show? This makes absolutely no sense-untill it does! Its a god damn robbery!!! Central banks making political policies across europe??? One fucking guy in the FED who decides what interest rates should be?!?! WTF????? Im going to find jp morgans grave, dig him up, and fuckin bitch slap his ass!!!! And that punk ass motherfucker woodrow wilson fucker sell out bitch!!!

Sat, 05/25/2013 - 21:08 | 3599019 Terminus C
Terminus C's picture

Sorry, it is me... I am Mark Carney, new bankster overlord of the world.  You are now my bitches, bitchez.



Sat, 05/25/2013 - 21:03 | 3599012 Atomizer
Atomizer's picture

Live by the sword, die by the sword.

Sat, 05/25/2013 - 21:09 | 3599020 maskone909
maskone909's picture

Or U3o8 for that matter

Sat, 05/25/2013 - 21:08 | 3599018 Atomizer
Atomizer's picture

Just watch it. Hahahahahhahahaha. Oh CPI core numbers

Sat, 05/25/2013 - 21:15 | 3599032 mickeyman
mickeyman's picture

I believe that's called Abenesia.

Sat, 05/25/2013 - 21:34 | 3599051 PiltdownMan
PiltdownMan's picture

Abenomics is as flawed as krugmanomics.

Sat, 05/25/2013 - 21:52 | 3599081 Atomizer
Atomizer's picture

Krugmanomics = World on A String

Sat, 05/25/2013 - 22:03 | 3599089 buzzsaw99
buzzsaw99's picture

Everything that is happening in the Japanese financial markets was and is utterly predictable.

the video starts reflate the japanese economy...

that translates: blow bubble in nikkei

1) yen crashes

2) kills (yen-bond bullish) carry trade

3) rush to equities from foreign bondholders

this will be followed by:

4) boj amps up bond purchases

5) nikkei corrects when import prices soar

6) yen strengthens v usd


it is the old bernanke pump and dump, in spades

Sun, 05/26/2013 - 00:12 | 3599232 Bansters-in-my-...
Bansters-in-my- feces's picture

It is not amnesia it is called "Abenesia"

Sun, 05/26/2013 - 00:19 | 3599236 chindit13
chindit13's picture

Funny that Zerohedge's Abenomics posts get so little relative attention and comment, because Japan is probably the key variable in all international markets right now, even more so than the EU, since Abenomics is such an aggressive strategy.  I know everyone loves gold around here, and those posts are what help pay the bills, but PMs are such a sideshow in the overall scheme of things, whose sum total represents barely a rounding error in world economics.  Seems a trees for the forest thing.

The BoJ is going to have to attack the JGB market this week, lest the whole show ends barely after getting started. If they can massage that market, the yen and Nikkei will follow along like an obedient dog.  Fail, and they risk a return to Halloween.

If they succeed in bringing some sort of stability, then Round Two of the Nikkei can start.  The HFs made the easy money, now it's time to bring in the Muppets.  I fully expect Goldman, Morgan Stanley, Barclays, etc. to launch a series of Japan Recovery Funds, aimed at internationally benchmarked portfolios, Bavarian Landesbanks, and the retail crowd.

Once that phase runs its course, then Abe has to step in again and browbeat domestic institutions to play nice and keep the ball rolling (uphill).

Blow it this week by having the BoJ get "confused" about JGB gyrations, and Abe will have to claim stress and step down again.

Sun, 05/26/2013 - 00:55 | 3599259 maskone909
maskone909's picture

The ultimate questions for central bank funing goverments is this: how long can goverments fund their own borrowing untill velocity catches up, or trigger a war from trade deficits.
As soon as velocity catches up, the real return on jgb's will be negative. The oher question is.... Can the boj buy bonds as fast as they get dumped? I dont think so

Sun, 05/26/2013 - 08:02 | 3599456 css1971
css1971's picture

Run this loop a billion times per second:

if bondAvailable and currentPrice < previousPrice: buyBond(bondAvailable)


They can make the market do anything they want it to do.

Sun, 05/26/2013 - 11:11 | 3599664 Hulk
Hulk's picture

I think you are wrong chindit13, a lot of us have been following Bass for years now, and Bass has been ponting out that Japan will be the first to blow up. So for that reason, I am laser focused on the goings on in Japan.

As far as commenting, what the fuck is there to say anymore, other than express shock over the financial shenanigans being pulled.!?!?!?

Always interested in your comments...

Sun, 05/26/2013 - 13:57 | 3599858 chindit13
chindit13's picture

Hulk, I can't see anyway Japan doesn't blow up, which is why I'm trying to be all over it. This post was just a consideration of what they might do next, or have to do next, merely to extend and pretend.  I guarantee that int'l banks are currently putting together Japan funds, and many int'l PMs were worried because they were underweight Japan.  They are/will be the capital flows that could keep it going a while longer, though last week might have/should have scared the bejesus out of them. The authorities must have noticed there was no bid under the market, and undoubtedly spent the weekend browbeating local institutions to step up. We'll see if they obey.

What hasn't been written about much re Japan are two things: 1) how this is in the process of killing the rest of Asia (SKorea, Thailand, China) and 2) how much rot Japan never cleared away from the early 1990s.  I know that back then many major firms tried to spin off losses into non-consolidated subsidiaries, and none of this has been addressed. Think of it like the "deal" Goldman put together to get Greece into the EU.  Back in the late 1990s Japan tried to toss all the blame on one foreign firm (CS, I think), but in fact every IB was structuring similar deals at the request of the corporate who's who of Japan. (By the way, do you know Japanese frms can do self-auditing?  They need not use a Big 3/5/8 accounting firm unless they have ADRs or other international listings. Honor system, like their signatures, which they buy at office supply stores, i.e. hanko)

At least major US banks recapitalized their visible balance sheets (though the derivatives OBS are still out there).  Japan did not, they merely shifted stuff around.  The EU hasn't even begun to shift around and obfuscate, much less recapitalize.

Sun, 05/26/2013 - 11:59 | 3599732 PiltdownMan
PiltdownMan's picture

I wrote a comment at LinkedIn on the rising Japanese yield curve (opposite of what Abe wants) and Dave Stevens of the Mortgage Bankers Association was furious! There is a mind set that it has to work and anyone disagreeing (like ZH) are dangerous.

Sun, 05/26/2013 - 13:58 | 3599859 e-recep
e-recep's picture

fuck you dave stevens, shove those mortgage documents up your asshole.

Sun, 05/26/2013 - 14:22 | 3599883 tip e. canoe
tip e. canoe's picture

you have to wonder what it will take for the Japanese to say "no mas" to being the guinea pig of the U.S.

Mon, 05/27/2013 - 06:15 | 3600683 david9821
david9821's picture

you have to wonder what it will take for the Japanese to say "no mas" to being the guinea pig of the U.S.

agreed above statement....

70-410 | 640-816 | 640-822 | 642-902

Tue, 05/28/2013 - 12:51 | 3603990 dariomilano
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seriously FT?

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