JPY Drops, Nikkei Pops On Japan's Worst Trade Deficit On Record

Tyler Durden's picture

You have to laugh really... We presume the rally in Japanese stocks and weakness in the JPY reflects an assumption that this dismal miss for both imports and exports - leaving Japan's adjusted trade deficit the worst in Bloomberg's 20 year history - means moar Abenomics. Of course, the headlines will be all about Abe's 'any minute now' comments or Kuroda's 'just one more quarter' hope (as he speaks later today) but the reality is that things are not getting better in the radioactive nation as this marks the 30th consecutive trade deficit... but, like Venezuela, when has that even been reason not to buy stocks... S&P futures are up 2.5 points (below Friday's highs still for now), gold has given back its earlier gains and is unchanged, and Treasury Futures are down a tick.


For the 30th consecutive month, Japan ran a trade deficit and this time it was the biggest ever as imports rose 16.5% YoY (missing the 19.9% YoY expectations by the most in 15 months) and exports rose 11.5% (missing the 15.6% YoY expectations by the most in 14 months)...


But of course, you buy stocks and sell the JPY on that shit-aweful news... (this is not catch up to US equities as it is an extension of the futures market's gains from Friday...)



Charts: Bloomberg

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HUGE_Gamma's picture

prob a narrow range day monday

VD's picture

radioactive exports up thx to yen -> nikkei to infinity!

TheRedScourge's picture

No shit they're going to run a big trade deficit, how else do they expect to delay the effect of all the inflation they're guaranteeing in the future, if not by exporting as many of those new yen overseas as they possibly can?

kaiserhoff's picture

You mean energy isn't free?

Don't tell Abe.

It would ruin his rice noodle knash.

Obadiah's picture

<------SHTF in less than 2 years

<------SHTF in more than 20 years


WTF?  this crazy shit can't go on much more....can it?

DavidC's picture

I've been asking that for the last 3 years.


NoDebt's picture

Plenty of people have been asking it for the last 20.

joego1's picture

It will go on as long as the sheep believe.

Yen Cross's picture

 Based on DXY values, the usd/jpy is over valued by 4-500 pips. It should be trading the 93.00 handle.

   You have a convergence of risk. The Fed. pump has made the $ a risk trade. Last week the markets took advantage of the dollar selloff. In order for the markets to climb higher the dollar has to strengthen. That just shows you how fucked up the jpy carry trade is.

NoDebt's picture

Yen- correct me if I'm wrong, but isn't a trade surplus one of the main pillars of support for the extrordinarily low interest rates that JGBs enjoy?  Their trade deficit has been on the wrong side of the line for a while now.  Any impact (delayed, perhaps)?  Or am I looking at this all wrong?

(I discount equity market indicators completely, FYI)


Yen Cross's picture

   Technically your correct NoDebt.  Japan however has crossed the Rubicon when it comes to debt. Why the markets still regard the yen as a safe haven currency is beyond me. I just trade it like I see it. Thanks for asking, I share  a lot of your concerns and questions. :-)

NoDebt's picture

Oh, for sure they crossed the Rubicon several GDP multiples ago.  Just makes me question the conventional wisdom of what keeps JGB prices levitated for at least several years now, given one of the legs of that stool got kicked out from under them when their perpetual trade surplus went all pear-shaped on them.  

Nevermind.  Deep down inside I already know the answer (money printing- ours, theirs, everyone's).

Yen Cross's picture

 +1 NoDebt, you're absolutely 100% correct.

NoDebt's picture

Thanks, but it's depressing to hear that, if you know what I mean.  Seems TBTF is as much an international phenomenon as it is a national one.  No major currency or economy allowed to fail for fear of dragging all the rest down with it.  I'm almost glad the big banks are in charge of everything.  If they weren't, this would have all melted down years ago.

Nobody crazy enough to order the circular firing squad.

Atomizer's picture

Go back about 6 months and run a trend. You’ll see a pattern on where they are laundering money.

IMF Santa Clause financial activity for Oct 9,2013


dudeman's picture

The Yen is overvalued by a lot. It's gonna collapse pretty damn soon.

fonzannoon's picture

All this while the 10yr JGB makes a push to head under .6%.


remain calm's picture

When the 10yr JGB breaks to the upside it is game over. It will stay low until the very end and then it all happens very fast.

chump666's picture
  •  5-year JS115/JS114 bid
  • 10-year JB330/JB329 sell
  • 20-year JL146 @ 1.475/-0.5bp sell

Japan is buying the short end, long end awaiting auction - due 22nd.  Japan will most likely buy the long end, a Japanese life insurer bought the 20 last Friday.  Profit taking and buying on dips.

The YEN is no longer a safe haven, stocks are, the bond market is almost a 100% owned by Japan in a strange Keynesian/commie/crony trade between pension funds and insurers.

No wonder the Japanese retail investors just trade FX, it's all that is left of a free market.

disabledvet's picture

about as fascinating as the Gulag Archipelago. My Kuroda! If i were Japan i'd be backing up and buying gold like it was the last thing left on the planet right now. Wall Street is long of course. Talk about "nosebleed."

Atomizer's picture

If we just build container sky rises through recycling low Baltic index shipment projections, they will come based on environmental platitudes.



DavidC's picture

Big pop on the FTSE out-of-hours as well, I phoned up to check - 6701. They said it was a valid price.


williambanzai7's picture

That's right, anti-radiation underwear.

Yen Cross's picture

  You'll always get a greenie from me Billy-7!

Landrew's picture

If you think about any of the crazy shit that is happening globally it will destroy your critical thinking. Trying to make sense of any thing happening isn't worth the time or effort. I stopped trying to understand it and now buy puts on BANKSTERS at opportune times. Anything I can do to take a  nickel from from these UNAMERICAN  scumbags is my goal!

FieldingMellish's picture

Fuck you, Dolphin and Whale.

John McCloy's picture

Markets love hyperinflation evidently...print it and steal from the peasants.

nakki's picture

How in the world is gold not worth $10000 an ounce, and who in the world would want to own yen?? In all honesty the dollar no matter how many are printed has to be better than any other fiat out there. That's how bad in my mind things really are. If you don't own PM you have to be an incredibly stupid.

holdbuysell's picture

And the Kyle Bass thesis takes yet another step toward reality.

abgary1's picture

The same will happen to the US markets when the dollar falls.

Cheap equities, who can resist?

Haager's picture

Worst trade data ever?! Oh, that's a buy, next time data comes out it will be better...