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This Won't End Well

Tyler Durden's picture




 

With both the Real Estate and Banking equity indices in Japan already in bear markets (down over 20% from recent highs) and the broad indices down over 15%, just how much pain can the massive influx of foreign capital take before the exodus really takes hold. Today's 'news' of the GPIF's allocation shift won't be enough to stem the tide as 'foreigners' (who have flooded on an epic scale into Japanese stocks) step away to the next hot-money focus... this won't end well.

 

The Real Estate and Banking indices were the best-performing, most hot-money riddled indices and evidence that things are shifting rapidly in Japan...

 

and with this kind of massive flood of foreign capital into Japanese stocks, we suspect things will not get any better when this chart 'normalizes'...

 

 

Charts: Bloomberg and Barclays

 

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Thu, 05/30/2013 - 11:38 | 3610598 ZippyBananaPants
ZippyBananaPants's picture

you can blind fold them with dental floss

Thu, 05/30/2013 - 11:43 | 3610616 Ahmeexnal
Ahmeexnal's picture

Oil's well that ends well!

Thu, 05/30/2013 - 11:48 | 3610633 El Viejo
El Viejo's picture

Divergence everywhere.

Thu, 05/30/2013 - 12:39 | 3610751 Randall Cabot
Randall Cabot's picture

May 30, 2013, 7:02 a.m. EDT

Ignore the news and buy Japan

"But the important point that this chart should convey is that even though it seems quite bad right now based upon the news coming out of Japan, my suggestion would be to ignore the news, and look to buy this consolidation for another rally back to the highs for a double top, and potentially even as high as the 12.65-12.95 region before wave (3) tops."

   

 

http://www.marketwatch.com/story/ignore-the-news-and-buy-japan-2013-05-30     

 

Thu, 05/30/2013 - 12:41 | 3610755 Obchelli
Obchelli's picture

Yes but with headlines like this

"Weak US data run gives stocks a lift"

http://finance.yahoo.com/news/weak-us-data-run-gives-143700414.html

This can go forever since warrants data will be getting weaker and weaker hence stocks going higher and higher

what a world

Thu, 05/30/2013 - 11:42 | 3610608 slaughterer
slaughterer's picture

Smart money Japanese are selling to the dumb money foreigners at the top.   

Thu, 05/30/2013 - 11:44 | 3610619 Ahmeexnal
Ahmeexnal's picture

dumbass loundeye investols

Thu, 05/30/2013 - 15:08 | 3611220 ParkAveFlasher
ParkAveFlasher's picture

Gwilo!

Thu, 05/30/2013 - 18:13 | 3611736 Randall Cabot
Randall Cabot's picture

Exactly

Thu, 05/30/2013 - 11:42 | 3610611 UH-60 Driver
UH-60 Driver's picture

RoR!

Thu, 05/30/2013 - 11:42 | 3610612 LibertyForSome
LibertyForSome's picture

If only it were so easy to print support for a family of 5, then I'd never have to work.

Thu, 05/30/2013 - 12:08 | 3610669 SemperFord
SemperFord's picture

That's how politicians do it

Thu, 05/30/2013 - 11:44 | 3610618 monopoly
monopoly's picture

Ooops!

Thu, 05/30/2013 - 11:54 | 3610623 Yen Cross
Yen Cross's picture

     Here's the numbers from last nights report.

 

  • Japan Buying Foreign Bonds Y -1117.3B (prior week was Y – 800.6B, revised from Y -804.4B )
  • Japan Buying Foreign Stocks Y -104.9B (prior week was Y -136.9B)
  • Foreign Buying Japan Bonds Y -457.2B (prior week was Y 17.6B, revised from Y 17.7B)
  • Foreign Buying Japan Stocks Y 27.4B (prior week was Y 715.8B, revised from Y 716.0B)<  1/10th of prior week, reflects the Nikkei selloff.
Thu, 05/30/2013 - 12:38 | 3610748 disabledvet
disabledvet's picture

"churning." spreads will widen, trading strategies will become more complex as more information is gathered. At some point you'll see some frontal assaults on Japan Inc itself (the whole Sprint thing looks like a template to me.) while not exactly dismantling ala Russian style does appear to be "making way for new ownership."

Thu, 05/30/2013 - 11:47 | 3610628 q99x2
q99x2's picture

I want a world that I can play with.

Thu, 05/30/2013 - 11:47 | 3610629 alien-IQ
alien-IQ's picture

Nothing "Ends well", that's why it's called "the end".

Thu, 05/30/2013 - 12:03 | 3610644 Dr. Engali
Dr. Engali's picture

Oh I don't know about that...Thelma and Louise drove off a cliff and that ended a really painful movie I was forced to sit through and watch. That ended well.

Thu, 05/30/2013 - 12:12 | 3610679 alien-IQ
alien-IQ's picture

I gotta admit, that's pretty hard to disagree with.

Thu, 05/30/2013 - 11:48 | 3610631 spaceduck
spaceduck's picture

"This won't end well", i continue to read the same words from long time.

Of course, the more time pass the worst it will end, and that's why MAYBE right now it would end soo badly that the world really cannot afford it to happen, therefore i would say:

 

"This won't end".

Thu, 05/30/2013 - 11:49 | 3610634 Groundhog Day
Groundhog Day's picture

Is that "oh Henry" buying them japanese equities

Thu, 05/30/2013 - 11:49 | 3610635 rubearish10
rubearish10's picture

"This won't end well". What has, since we've been reading this phrase? Will not admit PM's have ended well 'cause that's not over. Confidence is high on that.

So, nothing has ended badly. Nothing has ended. When will "it" end? Not in a Central Bank's lifetime, unfortunately.

Thu, 05/30/2013 - 11:50 | 3610638 rubearish10
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BTW, very bullish on PM's, so no down arrows on that part please.

Thu, 05/30/2013 - 12:35 | 3610736 CaptainSpaulding
CaptainSpaulding's picture

Its up there with " We're gonna need a bigger boat"

Thu, 05/30/2013 - 11:49 | 3610636 Zen Bernanke
Zen Bernanke's picture

I'll believe it when i see it.

Thu, 05/30/2013 - 11:50 | 3610637 Dr. Engali
Dr. Engali's picture

Maybe it's not a good idea to double your monetary base and blow out your bond market after all....idiots.

Thu, 05/30/2013 - 11:51 | 3610639 Reptil
Thu, 05/30/2013 - 12:45 | 3610768 LeisureSmith
LeisureSmith's picture

The pic seems to be missing from the enenews article but the linked article still have it. http://enformable.com/2013/05/tape-broomsticks-and-safety-cones-used-at-...

Apparently MacGyver was in the neighborhood.

Thu, 05/30/2013 - 11:52 | 3610642 slimething
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Yeahbut, CNBC says the U.S. economy is chugging right along with the throttle wide open.

Thu, 05/30/2013 - 11:55 | 3610648 Downtoolong
Downtoolong's picture

Even the cosmos are now sending us warnings of how QE will end it all. Still, the Muppets keep buying.

“Asteroid 1998 QE2's close encounter”

http://cosmiclog.nbcnews.com/_news/2013/05/30/18599228-asteroid-1998-qe2s-close-encounter-generates-a-wave-of-attention-online?lite

Thu, 05/30/2013 - 12:02 | 3610658 Dr. Engali
Dr. Engali's picture

Stock up on canned goods? Oh Brian you kill me. I'll be concerned when a comet comes within the moon's orbital path.  It is funny that it's called QE2. If it's followed up by a QE3 then I'll know we are in serious trouble. 

Thu, 05/30/2013 - 12:01 | 3610657 orangegeek
orangegeek's picture

80 percent plus of a bank's business is real estate.

 

US RE sales missed this morning.  This should bode well for banks.

 

Nothing but up.

Thu, 05/30/2013 - 12:10 | 3610675 teolawki
teolawki's picture

No worries. I'm sure Tepco can fix any financial meltdown for them.

Thu, 05/30/2013 - 12:28 | 3610704 LeisureSmith
LeisureSmith's picture

Yes, pour the toxic assets into the sea of greater fools. The sea of greater fools have magical dilutive powers. Too bad the top predators in the economic world don't eat their losses or the toxic waste they create.

Thu, 05/30/2013 - 12:33 | 3610730 NipponMarketBlog
NipponMarketBlog's picture

 

 

Notice how the locals (individuals) have been selling into the tsunami of foreign fast money. Food for thought.

Notice also how prop books were initially front-running the inflow of foreign funds last year, only to then stay fairly constant net sellers after that. Seems even they underestimated the pace of the market's ascent.

 

http://nipponmarketblog.wordpress.com/

Thu, 05/30/2013 - 12:36 | 3610740 Meat Hammer
Meat Hammer's picture

I'm starting to think that this can go on for a long, long......LONG time and I'm practically ready to tune out.

Which means it's probably going to hit the fan soon.

Thu, 05/30/2013 - 12:42 | 3610757 Dr. Engali
Dr. Engali's picture

I've had those same thoughts with the same conclusion several times over the last few years and still nothing.

Thu, 05/30/2013 - 12:45 | 3610767 fonzannoon
fonzannoon's picture

This is 2008 all over again right now. Japan = Lehman. This time though they are more prepared. If throwing everything at Japan does not work, and it won't, screws will come flying off all over the place.

Thu, 05/30/2013 - 13:21 | 3610867 Meat Hammer
Meat Hammer's picture

Ok, Fonz, I'm saving this comment thread and if 2 years from now it hasn't happened yet you have to pay for the Asian beauty of my choice...or that Latina one, second from the left, who looks like she hasn't seen her toes since puberty.  

Thu, 05/30/2013 - 13:23 | 3610877 fonzannoon
fonzannoon's picture

trust me MH when this thing goes it's possible you get 3 down days in a row on all the major indexes at which point you better buy that 3% correction violently.

Thu, 05/30/2013 - 12:58 | 3610814 venturen
venturen's picture

PUMP AND DUMP, BABY!!!

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