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The Japanese Bear (Market) Is Here To Stay
Late last night, Japan's Nikkei 225 touched the 12,815 20% correction level and bounced. With the collapse stronger in JPY this morning (sending JPY-carry-traders scrambling) that level has been well-and-truly breached with the Nikkei 225 now trading 12,760 - down 20.25% from the 5/22 highs of 16,020. It appears the "buy-the-dip-mentality" is lacking among market participants that are decidedly one-way on this ship.
Charts: Bloomberg
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Weeeeeeeeeeee!
Central bank failure! Don't bother consulting Ben about it Abe. He's just as incompetent as you - except has a larger military for now.
And a better helicopter apparently.
But I, the Great Krugman recently wrote an article in the NYT, praising Abe and the brilliant Japanese central bankers.
And as you are aware, I won a Noble and am NEVER wrong.
was it a noble Nobel?
...but that helicopter never seems to make it out of the bank parking lot...
Step right up Mrs. Watanbe and take a ride on the all new BoJ vomit comet... it will only cost you 100% of your life savings (since TEPCO already dibs on your life)...
bury that candlestick in Abe's ass
what the hell are they doing in the printing room? holiday???
Guess Japan has no PPT.
They did but they all commited mass sucide after having to work 16 hours days the past 6 months.
Nice ramp in gold just now... guess the NYFed logged into their bloomy terminal then ?
This could be serious. Japan is in a debt trap. Even modest increases in interest rates will destroy them. They actually need to vastly decrease the value of their currency and start to write off lots of unsustainable debt. I do not see any way forward that does not inflict a lot of pain on Japan. The broader question is how this all affects the global financial system. Short term, you could have lots of Japanese money flowing to the US to find safe haven. An increase in Japanese purchases of US T-bills, notes and bonds is probably a negative indicator for Japan.
The devaluation of the yen is the best thing that could happen to the global financial system as well as to Japan. The damage has already been done, it's only a matter of accounting for it. Europe and America have been using Japan as a model. They have to witness the fact that Japan's stability is based on an illusion.
US and safe haven in the same sentence?
Can anyone please explain to me why all this yen-printing is resulting in a lower Nikkei, higher JGB rates, and a STRONGER yen? Aren't those kind of inconsistent?
I mean, shouldn't yen-printing inflate the Nikkei and weaken the yen, in addition to lowering JGBs? It's like the opposite of what's happening with the USD (low treasuries and high S&P 500). Is the demand for yen coming from carry trades?
See the post directly above you. There's your answer. Debt trap.
Grasshopper, when you are able to take the pebble from my hand, it will be time to go.
Maybe there are levered CDS's that are starting to explode in a new spectacle of financial destruction across the world. Either that or people are fleeing the Japanese markets and this is actually a loss of faith in the currency.
because rich people with clever traders working for them are taking all that printed money out and putting it in their piggie banks
if s/he is lucky the bellhop might get a tip too
Aaan...it gawn.
Since '89 (the top of Japans largest RE/CRE bubble in history), Nikkei has declined from 40k to present 13k.
It has had at least 8 major rallies (each to a lower high) followed by massive selloffs (each to a new low).
If this pattern continues, Nikkei will likely be sub 7k later this year.
Buy the dip or in this case. Board the ship after it's struck to the Iceberg.