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JPY Plunges To 6-Year Lows, Nikkei Tops 16,000 As Japanese Deficit Runs 41st Month In A Row
For the 41st month in a row, the Japanese Trade Balance is in deficit (around JPY1 trillion). Of course, the fact that exports fell 1.3% (but but devalued currency means competitive?) means nothing as all that really matters is the collapsing JPY (now at 108.60) at its weakest against the USD in 6 years. That can mean only one thing - a surging Japanese stock market - as the Nikkei breaks 16,000. What is odd - just as in the US - is the rising equity index (no doubt helped by Japanese pension funds buying JPY393billion in Q2) against a backdrop of plunging indivdidual stocks. Sony is limit down (as we explained earlier) with offers outnumbering bids 8-to-1. And that's Japan...
41st month in a row of trade deficits... no J-Curve in sight
The JPY is collapsing...
Japanese stocks are surging...
- *JAPAN PENSION FUNDS BUY NET 393B YEN JPN STOCKS APRIL-JUNE QTR
But Sony is in utter freefall:
- *SONY YESTERDAY CLOSED AT 2,123 YEN IN TOKYO
- *SONY OFFERED LOWER AT 1,623 YEN IN TOKYO PRE-MARKET
- *SONY UNTRADED AT OPEN IN TOKYO, SET TO FALL
- *SONY SELL OFFERS OUTNUMBER BIDS 8 TO 1
- SONY FALLS AS MUCH AS 12% IN TOKYO, MOST SINCE NOV. 2013
And then there's this odd regime shift?
Charts: Bloomberg
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There is a point where insider trader is kicked to to the curb....
Great chart porn.
As a few of us have been pointing out, you can never print your way to prosperity. This experiment has been run. Zimbabwe billionaires are buying up all the sports teams and trashy broads, no? No.
It never works, but if you import most of your food and damn near all of your energy, it works even less. ???
I think I created a Yogi.
So Japan's trade deficit is at negative $10B/m.
What does that say about the US? The only thing I took away is the US is so completely screwed when reserve currency status finally gives...
Correct. Flow effects dominating for now, but accumulated deficits are going to make for a massive move.
In business school they taught us that a falling currency boosts exports and reduces imports (pushing you in to a positive trade surplus).
So, just ignore the trade balance chart and it's working exactly as it should.
Or, perhaps, it doesn't work when the stuff you're importing is must-have stuff, regardless of price (oil) and the stuff you're trying to export beggar-thy-neighbor style to the rest of the world finds there's little demand out there no matter how low the price.
I remember the late 1980s, when much of the world fretted that an efficient, intelligent, rational Japan, Inc. was going to dominate world economic markets.
Look at the Japanese sheeple being herded quickly & willingly towards slaughter today.
Bah aaah aah
It is clear that this year will be the largest trade deficit in Japans history. They really are up against it with Korea and now China eating their Lunch with superior goods in electronics, cars, machinary and medical goods. But they still do one thing better than any one else... "Dutch wives" (google and be informed)
Abe's arrows are broken
speaking of the late 1980's, we are all clear that the nikkei 225 was around 40,000 then, right? puts whatever teenage number it is at now into perspective.
http://en.wikipedia.org/wiki/Nikkei_225
the US....screw the US, they are pumping up the market, with liquid viagra.
it will get no one no where.
he overall path for policy that they’ve been on continues to be a path they are comfortable with, that is flooding FAKE MONEY INTO THE MARKET> This chart is why the bears HATE THIS MARKET ===> http://bit.ly/1fMcakI
Bullish ...
They have the best corn dogs anywhere in Sasebo.
FORE-WARD SOVIET!
Money for Nothing and Fuku-Sushi for Free?
Looky there. Inflation eating away at Japan's national debt like pacman eating a blue ghost.
internal debt is one thing for inflation - external debt is another thing for inflation...
BTFBND........ Buy the fucking bankrupt nation dip.
what dip?
BTFPMH.....Buy the fucking parobolic move higher
Yen weakness and yuan strength will soon invert. Watch for the yen bounce. Yuan heads back to 8. How are they going to save the euro from dollar parity? Pound at 1.50 looks solid. Who's buying the kiwi?
False. Dominant strategy for China is to let it appreciate because we have no consumption growth capacity anyway. Biggest untapped consumer market is China as soon as they allow income and wealth effect of currency appreciation.
Not odd at all. G3 currencies may lose a lot of value with respect to CNY. It's a matter of flow and stock. Everyone is positioned upside down because all we westerners think about is relative to G3. Eventually, Japan will hit a breaking point and have to liquidate USD, and then USD will take the real hit. Right now, flows are dominating accumulated deficits, but they too will be worked off.
Japan will collapse first...They must do what USA told them.
At some point in the not so distant future, apocalyptic movie values will approach zero other than for use as training films.
The writing is on the wall. Japan is facing a wall of debt that can only be addressed by printing more money and debasing their currency. This means paying off their debt with worthless yen where possible and in many cases defaulting on promises made. Japan's public debt, which stands at around 230% of its GDP and is the highest in the industrialized world.
The moment the Japaneses stock market fails to rise enough to offset inflation this will turn into a tsunami of money fleeing Japan and constitute the end of the line for those left holding both JGBs and the yen. This has been a long time coming and I contend the cross-border flow of money leaving Japan is why some stock markets such as ours in America have remained so resilient . When Japan crumbles it will be felt across the world. More on this subject in the article below.
http://brucewilds.blogspot.com/2014/05/japan-sliding-towards-abyss.html
If we're lucky one of these earthquakes will finish us off first