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Losing Faith? Traders Dump Japanese Stocks At Fastest Pace In History
The narrative of the omnipotent central banker continues to be questioned with China's inability to save its own market the latest incarnation of investors losing faith. Nowhere has the religious zealotry been more fervent than in trading Japanese stocks where Abe and Kuroda have broken every independent rule in their manipulation of wealth-giving stocks. However - it appears their time is up, as Bloomberg reports, foreigners dumped 1.43 trillion yen of Japanese equities in the three weeks through Aug. 28, Tokyo Stock Exchange data updated Thursday show. That’s the most for any three-week span on record, overtaking the period when Bear Stearns Cos. collapsed in 2008.
Global investors are pulling money out of Japan’s equity market at the fastest pace since at least 2004, according to Mizuho Securities Co. As Bloomberg details,
Foreigners last week sold a net 1.85 trillion yen ($15.4 billion) of Japanese stocks and equity index futures, the biggest combined outflow since Mizuho began tracking the data more than a decade ago, said Yutaka Miura, a Tokyo-based senior technical analyst at the brokerage. Investors are fleeing amid concern about China’s economic outlook and the prospect of higher interest rates in the U.S., he said.
“This is a result of investors dumping global risk assets,” said Miura. “Japanese stocks have performed well since the start of the year, so similar to what’s happening in Europe, we’re seeing people take profits.”
Foreigners dumped 1.43 trillion yen of Japanese equities in the three weeks through Aug. 28, Tokyo Stock Exchange data updated Thursday show. That’s the most for any three-week span on record, overtaking the period when Bear Stearns Cos. collapsed in 2008.
Net stock sales totaled 707 billion yen last week, and investors also reduced positions in index futures by 1.14 trillion yen, exchange data show. Cumulative flows for 2015 are still positive, with foreigners buying a net 1.1 trillion yen of equities through last week.
As one local broker noted,
“The sell-off started in China," Clarke said. “Investors couldn’t sell there in the end so selling spread to Asia, and Japan especially as it has a greater liquidity. This eventually spread to Europe and the U.S.”
Time for some moar QQE Mr. Kuroda? Oh wait - you can't!!
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This has to be awkward for all those managers who've been incessantly saying that everything's and then do this.
But then again, awkward's relative. My doctor was checking my balls for any lumps the other day. It got awkward when I ran my fingers through his hair.
LMAO knuks!!!
We're all turning Japanese.
Bob Janjuah on the deflationary wave
http://www.planbeconomics.com/2015/09/bob-janjuah-on-global-deflationary...
That was funny about the doctor. I laughed. I cried. I crapped my pants. Deflation is the name of the game. Learn it, live it, love it.
"My doctor was checking my balls for any lumps the other day. It got awkward when I ran my fingers through his hair."
Understood. My doc had to give me a postate exam a couple months ago. Before we started I let him know I normally don't do that sort of stuff without at least a nice dinner and a move beforehand. I thought he would laugh, break the tenison. Wrong. It got really uncomfortable after that (in more ways than just one).
Next time try "Is it in yet?"
That ought to change the dynamic.
Worst 4 words a man can hear...
especially when followed by "Are you done yet?"
You silly boys. My doc is female, and hernia checks are FUN!
My buddy was telling me about his prostrate exam a few months ago. While the Doctor was poking around down there he asked my friend if he had any questions? My friend asked yes, why are both your hand on my shoulders?
I've always said "Japan goes first". We'll see if this is it (doubt it, but whatever). If it is, the rest will fall more quickly after that. Europe, then the US.
ND, i think South America is in the running for first or second...
They'll just get their face torn off along with the big boys. I'm talking more about countries that borrow in their own currency. The ones that write their own ticket. That means Japan, the US and Europe (Euro-area).
Everyone else borrows in somebody ELSE'S currency and they may actually end up in slightly better shape when it's all said and done, but in no way BETTER than now. Just slightly less damaged.
Germany then Japan.
On second thought, name a continent that isn't ready to crash and burn...
Antarctica.
Iceland.
Kim's kardASSian
Greenland and Mrs Yellen's balls.
Japan is a train wreck. Absent a sudden large scale war, I have to believe the first domino falls in the Land of the Rising Sun.
I've been to Japan many times. The culture is unique, if xenophobic. The people are kind to a fault, even if they secretly look down on foreigners. Their devotion to work is legendary, though much of it is illusory. It is a zany place in countless ways.
Keynesianism's first nail in the coffin starts in Tokyo. Their debt load is enormous, their "markets" are even more manipulated than ours. Their economy is a Potemkin village. And then there is Fukushima.
We should carefully observe the deflationary implosion looming on Japan's horizon, followed by the manic currency creation and hyperinflationary collapse, because it's coming to our shores soon enough.
You are correct, Japan will not only be the first domino to fall, it is also where the coming war with China will kick off.
Look for a false flag event (perhaps perpetrated by the U.S.) that sacrifices hundreds of thousands (millions?) of innocent Japanese lives, which will conveniently be blamed on China.
As goes Japan, so does the US.
The US is seeing it's Keynesian future in Japan.
You're kidding, right ? Japan is going to boom when the war breaks out. The Japanese MIC is salivating at the thought of Shogun Abe going in for the Chicom kill and an endless supply of military hardware contracts and cannon fodder etc.
President Aquino has probably guaranteed an endless supply of Filipino pussy and the great Imperial Japanese Defence forces will gloriously exterminate the little yellow bellied Chicoms as they almost did in WWII. Has the Pentagon requisitioned an order for body bags for Amerika's cannon fodder ?
Shogun Abe can talk a good fight but it will be Americans coming home in body bags in any armed conflict.
So true - back in the 80's I finally was let into the inner sanctum of one the larger Japanese trading companies - I was in awe from the outside watching these guys pull non stop 15 hour days.
Until I got to see behind the curtain and realized 9 of those hours were card playing, porn watching, 3 hour wet lunches, smoking & bullshitting and pretty much doing anything not to go home to the Mrs.
Unquestionably intelligent, descent and honorable people - however very strange I think from centuries of isolation until historically speaking just recently Westernized.
That's a fair analysis. Especiall the intelligent part. If you're Japanese and working in a trading company, it means you busted your ass in middle school, high school, and college (well not so much) are are definitely on the high IQ side.
jb
This is what happens in heavily subsidized economies. All signals get screwed up--economic, political, and social. People are unable to determine legitimate, productive perspectives on society and the world. Instead they toil for a paycheck.
The really good ones read the political signals and engage in the sociopathic chess game, rising through the ranks to become dysfunctional politicians, executives, and leaders. In these roles, they contibute to the broken feedback loops by advancing their advocates and destroying their adversaries, all in a game that confuses prestige with pretentiousness, respect with fear. All the while, squeezing the genuinely productive to the periphery of society and the economy.
After a couple generations of heavy subsidy, the sophists, sociopaths, and authoritarians dominate society. They mug for cameras, obsess over others' views of them, and never realize they don't understand anything--they are sitting atop a great pile of stimulus that depends on deceit, manipulation, and shallow sentiments that change with the breeze.
If the genuinely creative, productive truth-sayers aren't isolated or purged, they are broken like a beaten horse and give up. They give up because they aren't stupid; why have one's resources extorted and used against them, only to live a stress-filled life defending oneself from perpetual attacks by the schemers that need a fall guy?
The US is in the same place. When the tide goes out, it will be amazing the number of people left naked. In the past, we'd see the little peckers of exposed national politicians and corporate executives. But regulations like Sarbanes Oxley, in an attempt to make 'higher-ups' accountable, has instead exposed controls where accountability lies. Many sociopaths see controls as something to avoid else they be held responsible when things fall apart. They'll throw responsibilty for controls around like a hot potato. Even worse, it's enabled sociopaths to pawn responsibility for the controls off on poor oblivious suckers (often contractors that will take a fall for a buck).
The subsidized and illegitimate economy is so vast and supports so many clueless, ineffective people that low-level functional managers are going to be left holding the bag as everyone else scrambles for cover. But it's not going to work. We'll soon see that the new aristocracy isn't nearly as inclusive as many partners, directors, and mid-level bureaucrats think it is. The elites will circle the wagons in a much tighter formation than the small-scale meglomanics realize. Most will be left out in the wild as a great wall of meat.
Time to run.
Train wreck is a cliche. Just as the Sun rises from the East, Japan shall be the first to face the downsizing of the paper asset markets which is a myth that it represents the real economy of goods and services. High infaltion is a cleanser to crippling debt. It is another myth that Japan's demographic challenge (an aging pop) shall not deliver the consumption growth that fits the projections of the NUTS. It is quality and not in many cases the asinine immigration drives for quantity with declining consumption power. (Just shifting preys from one wasteland to devour another wasteland). Japan shall cross this rubicon first with reduced pop but not extinct. It could be right sizing for the future.
Contagion shall speed up the collapsing of paper assets and with it the evisceration of debts. (Why a bad scenario ?). Want to play long term trends...here they are for thoughts.
Fuck Kuroda and Abe.
More assets for the elite that own the central banks.
Only a financial advisor that is not retiring soon would tell you to stay in the stock market “because it only took 5 years to recover the loss of the last recession”.
Here are some more signs of a recession.
http://michaelekelley.com/2015/05/29/mergers-and-acquisitions-set-record...
http://michaelekelley.com/2015/02/20/fed-warns-of-two-bubbles/
http://michaelekelley.com/2015/02/24/would-you-pay-39-more-than-asked/
http://www.zerohedge.com/news/2015-07-27/when-will-we-ever-learn/
Here is how to respond.
http://michaelekelley.com/2014/10/16/8-things-to-do-when-recession-happens/
Here is how to get your mind off this stuff.
http://michaelekelley.com/category/humor/
Good luck!
Pimp
The entire narrative on the stock market by the corporate press is complete nonsense. Corporate media continuously talks about market psychology, momentum, technical analysis, etc., while conveniently ignoring the “facts on the ground”. What is the current state of US capitalism? High unemployment coupled with anemic job growth- >90 of “new” jobs are temp positions- read low pay, no benefits or job security. The stock market has been goosed by large corporations engaging in stock “buybacks”, using ultra cheap $$ supplied by the FED (read US taxpayers), which reduces the number of outstanding shares and increases stock price. Auto sales have been propped up with subprime auto loans. Insolvent banks are still being kept on life support, coutesy of taxpayer largess (read QE). Despite all of these gimmicks, the US economy (and stock market) continue declining. You cannot have economic growth without working people have more purchasing power. Temp jobs/ high unemployment do just the opposite by reducing wages and purchasing power. My advice, buy as much gold as u can start shorting all major stock indices, including the Nikkei (a train wreck waiting to happen), Dow, SP, Nasdaq and Russell 2000. This is not going to be pretty, but with prudent planning and investment you can protect yourself.Talk about job loss and temp work...my buddy got restructured/fired/layed off from his 11 year STEM job at an energy company. Now he waits tables part time and is a barrista other times so he can pay his mortgage, put food on his table and finish helping his daughter through school. He and his wife [who still has her full time job] are desperately trying not to dig into their savings as best they can knowng what lies ahead. They read zh and understand how bleak the usa economy looks for the private sector even with a solid degree and years of experience.
@Phillyguy
You left out the executive stock options Stock buybacks are a great idea so their options are always in the money. Talk about investors being scammed. We'd be better off buying gold instead of shares. Even when the price may drop, at least it still stays shiny and it sits very nicely on your palm.
Margin calls mean uncarry, as with the pension fund vomitorium.
The words illusion and mirage are both very interesting and can conjure up strong images. Often when we look behind the curtain we find the products of sophisticated traders are highly leveraged and stack layers of risk upon the huge amount of risk that already exist. When we mix in the impact of derivatives and its sister "shadow-banking" the water gets really murky.
The carry trade exploits small differences generally in a highly leveraged environment in the hope of banging out a profit. We sometimes have to wonder just how much the central banks consider this in their overall scheme of economic control. In the end when the dominoes known as "world currencies" come under pressure and begin to fall, the direction or how they fall will make a great deal of difference in the financial landscape we are left to face. The article below explores this important part of the economy.
http://brucewilds.blogspot.com/2015/09/cross-border-money-flows-and-carry-trade.html
Japan is finished.
As goes Japan, so does the US. Into the debt black hole.
So...looks like a halt to selling there for a bit?
What? No halt to buying ever but "self-help" against selling? PONZI!
So I guess all that Abenomics and more stocks in GPIF portfolio was about handing our money to foreign banks.
I'm not suprised.
Central banks are independent.
Independent of their nations best interests.
But the heads of all major Central Banks are directors of the Bank of International Settlements in Switzerland (including China).
Our policy makers are the same the world over and they reside in the BIS in Switzerland.
The policy is to prop up the global banking system.
http://www.bis.org/publ/arpdf/ar2015e7.pdf
pg 13, 25 & 26
pg 34 BIS Budget Policy:
Management begins preparing the annual BIS expenditure budget by establishing an overall business plan and financial framework. Within that context, business areas specify their detailed plans and resource requirements. The process of reconciling detailed business plans, objectives and overall resources culminates in a draft budget, which must be approved by the Board before the start of the financial year. The budget distinguishes between administrative and capital expenditures. In 2014/15, these expenditures collectively amounted to CHF 296.8 million. The Bank’s overall administrative expense amounted to CHF 277.9 million. 8 Management and staff expense – including remuneration, pensions, and health and accident insurance – amounts to around 70% of administrative expenditure, comparable to the ratio seen in organisations similar to the BIS. New staff positions were added during the year in accordance with the Bank’s business plan, which emphasised economic research, the Basel regulatory process and BIS banking activities. 8. The financial statements report a total administrative expense of CHF 356.2 million. That figure consists of the CHF 277.9 million actual administrative expense reported here plus CHF 78.3 million of financial accounting adjustments for post-employment benefit obligations. This additional expense is not included in the budget for the coming financial year because it depends on actuarial valuations as at 31 March, which in turn are not finalised until April, after the budget has been set by the Board.Don't worry, the coalition for the rule of law is going to manage a transition from paper currencies to aurum in a global currency reset:
http://www.peakprosperity.com/podcast/84359/new-way-hold-gold
We may be in for a bumpy ride, so hang onto your hats. But the likelihood that we all make it to the other side in one piece is about 90-95% https://s3.amazonaws.com/khudes/sentia+model.pdf
Here is to let you know what is happening with Russia:
http://sputniknews.com/society/20150831/1026396611.html
Karen Hudes ·
Don't worry, RT. The coalition for the rule of law has just put liens that go into effect in ten days on the private assets of Obama, Biden, Lew, Kim, Lagarde, Dempsey, McHugh, and a few more lawbreakers: https://s3.amazonaws.com/khudes/Hudes%2C+Karen_World+bank+agents%2C+et+al.+Commercial+Lien_9-1-15.pdf
A wise man on ZH once said Europe would be in flames before the U.S. even farted.
Well, Europe is now in flames.
Since Japan is a sovereign nation in name only and wholly beholden to the U.S., why not pass gas there instead of in the Homeland?