Nikkei Soars By Over 400 Points As BOJ Redirects Attention From QE To Loans

Tyler Durden's picture


Clearly boxed in by the concern that any increase in their QE program will shift sentiment from stimulus to monetization, the BoJ kept the money-printing the same but redirected focus by raising the ceiling on their bank lending facility (from JPY3.5 trillion to JPY 7 trillion). This is being presented to the public as dovish despite the balance sheet recession's debt minimization - not profit-maximization - mantra as was oh so well illustrated by the dismal GDP prints since Abenomics has been in existence. It's not like Japan needs "low-interest" rate loans... are their rates high? Of course, in order to maintain some semblance of hope and belief in this new "common knowledge", USDJPY was smashed higher (running stops over 102.50) and that leveraged Nikkei futures up over 400 points in the space of a few minutes. S&P futures are modestly higher but EM FX is drifting lower.



Notice the initial disappointment in JPY and Nikkei with no additional stimulus only to be 'managed' higher...


The question on everyone's lips, of course, is - what is the BoJ's half-life?


S&P futures and Emerging Market FX ain't buying it for now...

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Tue, 02/18/2014 - 00:36 | 4446934 VD
VD's picture

half-life not very long methinkz...

Tue, 02/18/2014 - 00:48 | 4446958 DeadFred
DeadFred's picture

Cheap way to get two posts out of one event. If Tyler wanted to be brave he would posit a opinion on whether it will be measured in minutes, hours or days. I'm going for 24 hrs for a complete round trip.

Tue, 02/18/2014 - 01:21 | 4447008 wintermute
wintermute's picture

Has Congress noticed that Japan is a "currency manipulator" yet?  (Because US exporters are being bitch-slapped - again).

Tue, 02/18/2014 - 01:28 | 4447028 chinoslims
chinoslims's picture

All's fair in war and QE


Tue, 02/18/2014 - 01:30 | 4447035 National Blessing
National Blessing's picture

They get a temporary reprieve from deflationary pressure.  But gravity is gravity.  The Yen will soar again.  Blockheads.

Tue, 02/18/2014 - 06:51 | 4447296 disabledvet
disabledvet's picture

destroying a currency is not hard.

"managing its destruction" however is.
they're doing everything they can to raise dollars while at the same time devaluing massively.

That makes every dollar denominated theory...up for sale.

Tue, 02/18/2014 - 07:14 | 4447307 Headbanger
Headbanger's picture

S&P futures chart says rook out berow!

Thanks again to Daneric's blog

Tue, 02/18/2014 - 07:51 | 4447333 GetZeeGold
GetZeeGold's picture




Money everywhere......but not a drop to spend.

Wed, 02/19/2014 - 03:57 | 4451678 Exponere Mendaces
Exponere Mendaces's picture



Tyler said it was GOING DOWN MAN!?


I guess he's bullshit on Bitcoin too. Nice track record.

Tue, 02/18/2014 - 00:41 | 4446948 infiniti
infiniti's picture

Dragging US equity futures higher too, of course.

Tue, 02/18/2014 - 10:10 | 4447651 SAT 800
SAT 800's picture

Not so far; down a little 9;10AM NYT.

Tue, 02/18/2014 - 00:44 | 4446952 Rukeysers Ghost
Rukeysers Ghost's picture

Damn the torpedoes, full speed ahead!

Tue, 02/18/2014 - 00:59 | 4446977 thedrickster
thedrickster's picture

ZN not playing along.

Tue, 02/18/2014 - 01:43 | 4447059 OC Sure
OC Sure's picture

nor zb


Tue, 02/18/2014 - 01:05 | 4446988 slightlyskeptical
slightlyskeptical's picture

The Japanese are not borrowing...what benefit does lending yen to hedge funds provide to Japan? This is basically Japan throwing in the towle on QE.

Tue, 02/18/2014 - 01:07 | 4446991 NDXTrader
NDXTrader's picture

Thank you, ZH. Great analysis. Sometimes you have to ask why others can't see it. Words...nothing but words

Tue, 02/18/2014 - 01:09 | 4446995 ebworthen
ebworthen's picture

"Baffle 'em with Bullshit God Damnit!  Baffle 'em with Bullshit!!!"

Bullish for hot Japanese teens selling bonds to old men.

There's a foundation for the future.

Almost as good as the U.S.S.A.

Fucking assholes.

Tue, 02/18/2014 - 01:19 | 4447010 LetThemEatRand
LetThemEatRand's picture

Remind me again how the bankers lose control when they have unlimited power to manipulate the markets at the expense of the middle class and said middle class is still sleeping?

Tue, 02/18/2014 - 01:30 | 4447032 hobopants
hobopants's picture

My guess is that the greedy sociopaths run out of middle class wealth to steal and start fucking each over at the expensive of the system.

Tue, 02/18/2014 - 01:47 | 4447071 LetThemEatRand
LetThemEatRand's picture

No doubt.  Thus the hollow points to keep us in line while they vie for control.

Tue, 02/18/2014 - 01:39 | 4447050 ThroxxOfVron
ThroxxOfVron's picture

"Remind me again how the bankers lose control when they have unlimited power to manipulate the markets at the expense of the middle class and said middle class is still sleeping?"

Patience my boy; in due course the slumbering giant will be aroused and tradgecomedy will ensue.

They haven't even finished stripping the fat let alone tasted the meat on them bones...

Tue, 02/18/2014 - 01:50 | 4447075 OC Sure
OC Sure's picture

"Remind me again how the bankers lose control when they have unlimited power to manipulate the markets..."

Reminder: Bankers lose control because your premise is incorrect. They do not have unlimited power to manipulate the markets.

Their power is limited specifically by the market. While they do corner the market on interest rates for now, they cannot corner it perpetually. Thus is the market. They are fucked by their very nature to attempt the corner.


Tue, 02/18/2014 - 01:25 | 4447019 chinoslims
chinoslims's picture

Fuck I took the short on USDJPY.  Better luck next time.  I'll take the 13.5 pip loss


Tue, 02/18/2014 - 01:53 | 4447080 Leveraged Algorithm
Leveraged Algorithm's picture

Long - what would make you short when they are still braindead?

Tue, 02/18/2014 - 03:30 | 4447196 TheRideNeverEnds
TheRideNeverEnds's picture

I am thankfull I took the few pips I had with my long yen and moved into short GBP/USD its not great but at least its not terrible (yet).   Though I am thinking since I am short it now the pound is going straight to 2.0 from here.

Tue, 02/18/2014 - 10:13 | 4447666 SAT 800
SAT 800's picture

Keep the faith and hang in there; I have money on this too; The Pound is a currency with no visible means of support and a moribund economy behind it; this is just a short term top. you need a time line like until December of this year; short term FX trading is just a waste of time,  usually.

Tue, 02/18/2014 - 01:29 | 4447031 Spungo
Spungo's picture

Japanese stocks should shoot to the moon as people realize their government bonds will become worthless. Panic sell bonds. Panic buy stocks. Yields should explode, stocks should explode, currency should become worthless.

Tue, 02/18/2014 - 01:31 | 4447037 hobopants
hobopants's picture

zimbabwe 2.0

Tue, 02/18/2014 - 01:37 | 4447046 aka9
aka9's picture

Unlike market consensus, Japan stock could go up together with JGB until the very last minute, and intermittent panic in Japan will bring USDJPY lower together with Nikkei until it's getting near insolvency! I would guess USDJPY will touch 80 handle first before becoming worthless.

Tue, 02/18/2014 - 01:38 | 4447048 Loanman26
Loanman26's picture

And as usual our US open will be green. The mirage continues.

Predictable as the sun coming up in the morning. WTF



Tue, 02/18/2014 - 01:43 | 4447060 Spungo
Spungo's picture

"My guess is that the greedy sociopaths run out of middle class wealth to steal"

Actually, it's mostly the middle class stealing from the middle class. The biggest debt burdens are social security and medicare, which mostly benefit the middle class. The military is a giant expense that mostly employs poor and middle class Americans. It's always the middle class voting against any cuts to these programs. Americans WANT the country to be destroyed. The politicians are just doing what their voters want.

Tue, 02/18/2014 - 02:21 | 4447117 hobopants
hobopants's picture

"The biggest debt burdens are social security and medicare, which mostly benefit the middle class."

Why is it a debt burden? It couldn't be because all the money allocated for it was used to bail out banks and fund various other adventures in cronyism? and it doesn't benefit the middle class any more than the poor, The middle class just get to pay for it.

"The military is a giant expense that mostly employs poor and middle class Americans."

To the benefit of oil companies and the military industrial complex owned by the elite. pay a solider peanuts and reap the rewards in looted natural resources and arms contracts.

Tue, 02/18/2014 - 01:44 | 4447061 starman
starman's picture

Harakiri or Kamikaze? Both end well....not so good. Your choice.

Tue, 02/18/2014 - 02:38 | 4447133 q99x2
q99x2's picture


Tue, 02/18/2014 - 02:40 | 4447134 Spungo
Spungo's picture

Set aside? Those funds were never set aside. It's a ponzi scheme. The money you pay into the system is payed out to the people who were already retired. People knew this from day 1.
And yes the military is a gigantic welfare program for poor people. Run on a platform of cutting military spending and see how many votes you get.

Tue, 02/18/2014 - 02:49 | 4447149 q99x2
q99x2's picture

Gold backed trade zones are coming to a world near you

Tue, 02/18/2014 - 07:50 | 4447340 GetZeeGold
GetZeeGold's picture



Welcome. We accept gold here.

Tue, 02/18/2014 - 03:00 | 4447157 NDXTrader
NDXTrader's picture

We are getting close to the straw breaking the Camel's back. This was a desperation move

Tue, 02/18/2014 - 04:16 | 4447231 Platinum
Platinum's picture

The next few weeks will be critical. I wonder how much time is left...

Tue, 02/18/2014 - 07:47 | 4447336 Oh regional Indian
Oh regional Indian's picture

Right till the ides of march...14-21st...or so...then watch out below.

Tue, 02/18/2014 - 02:57 | 4447158 ReactionToClose...
ReactionToClosedMinds's picture

whew ... that was close --- i can finally sell my Wisdom Tree Japan ETFS (which made me look smart for about 5 months ......)... thank you....can I repeat ..... thk you...... bought these on thought Japan had to to full Aben omics before Abe was in power...... but what a growing cluster fluck.....including PRChina (read Michael Pettis excellent book The Great Rebalancing).

Risk, risk everywhere but all people want to know is what is the next best stock .....................remember that David Weidenr of Marketwatch! 

Tue, 02/18/2014 - 03:13 | 4447177 TheRideNeverEnds
TheRideNeverEnds's picture

S&P 1900 bitches! 

Tue, 02/18/2014 - 04:56 | 4447245 NDXTrader
NDXTrader's picture

Futures are fading. I think anyone with a brain that programs an algo can see this means nothing...AND most importantly means they were scared to do more QE

Tue, 02/18/2014 - 05:05 | 4447248 Rising Sun
Rising Sun's picture

Every day is a gong show.


Gotta run - breakfast on Mars and the spaceship leaves in 30 minutes.

Tue, 02/18/2014 - 05:10 | 4447253 Apostate2
Apostate2's picture

Another banker from JP Morgan jumps to his death in Hong Kong (OT)

A man early on Tuesday jumped to his death from the top of Chater House in Central, where Wall Street bank JP Morgan has its Asia headquarters, witnesses told the South China Morning Post.

The man, said to be in his early 30s, went to the roof of Chater House, a landmark 30-floor building in the heart of Hong Kong’s central business district – also near the city’s stock exchange – and jumped.

The incident happened between 2pm to 3pm, a witness said.

Several policemen were seen on the roof but apparently failed to convince the man not to jump, one of the witnesses said.

According to several JP Morgan employees, the man was a forex trader with the company.

However, a JP Morgan spokeswoman said the bank was aware of the incident but it could not confirm at this stage whether the deceased was an employee.

Tue, 02/18/2014 - 06:42 | 4447292 damicol
damicol's picture

It is true,, all apart from one tiny detail,

It was the police and two guys wearing black suits and shades  and had  govmint written all through them that dragged the poor guy to the roof.

Of course letting even your girlfriend in the middle of the night   through a whisper in her ear that you are about to become a whistleblower is not going to save you.

I just wonder what they they told him that persuaded him that jumping was the best and only option he had left


Tue, 02/18/2014 - 07:51 | 4447342 RaceToTheBottom
RaceToTheBottom's picture

Thanks for the link

Tue, 02/18/2014 - 13:39 | 4448708 Uber Vandal
Uber Vandal's picture

No problem.

Tue, 02/18/2014 - 09:26 | 4447493 Hongcha
Hongcha's picture

Chater house is an important symbol of British colonial banking in HK.  That's like jumping from the roof of the House of Morgan.

Do NOT follow this link or you will be banned from the site!