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Another Abenomics Fail: New Survey Shows Inequality Growing In Japan
One thing that’s become abundantly clear in the post-crisis world is that round after round of QE are enriching the few at the expense of the many.
Ben Bernanke (the architect of the current DM CB regime) will tell you that the growing divide between the haves and the have nots isn’t attributable to central bank policy because after all, the poor have been getting poorer vis-a-vis the rich for decades and so whatever effect the Fed may have had is surely minimal from a historical perspective.
That is of course absurd. When you deliberately inflate the value of the assets that are most likely to be held in the hands of the rich, you are explicitly exacerbating the wealth gap and the effect QE has had on the value of financial assets the world over is certainly no secret.
Nowhere is this more apparent than Japan, where central bank Governor Haruhiko Kuroda has become the poster child for Keynesian insanity after commandeering 52% of the domestic ETF market on the way to providing daily plunge protection for the Nikkei.
We've documented the effect this has had on stocks on any number of occasions and we also noted back in April that according to Akio Doteuchi, a senior researcher at the NLI Research Institute, anyone in the middle class is now at risk of falling into poverty.
Well, even as the BoJ recently "disappointed" the market by not announcing more QE, the wealthy are still getting wealthier under Abenomics. Here's Bloomberg with the most recent read on household wealth:
Signs of inequality in Japan are increasing as people living on their own fall further behind and wealthier households accumulate more assets, according to surveys released Thursday by the Bank of Japan.
The ratio of single-member households with no financial assets climbed to almost 48 percent in 2015, the highest level since 2007, from about 39 percent a year earlier, according to an annual survey by the central bank. At the same time, households with two or more people who held assets such as stocks and bonds saw these rise to a record high 18.2 million yen ($149,597), a separate BOJ report showed.
The widening inequality highlights Prime Minister Shinzo Abe’s challenge as he seeks to spread the benefits of record corporate profits and stock prices that this year reached levels not seen since 1996. Low-income households are feeling the effects of last year’s sales-tax hike and limited wages gains while more well off Japanese are benefiting from the swelling value of their investment portfolios.
“Inequality seems to be widening,” said Hiroshi Hanada, head of economic research at Sumitomo Mitsui Trust Bank Ltd. “A sales-tax hike and price increases last year hit households hard. Abe hasn’t succeeded to bring benefits to most ordinary people.”
Right. Abe hasn't really "succeeded" in doing much, but as the above seems to indicate, one thing that hasn't been a problem is making the rich richer. Of course improving the plight of everyday Japanese is an entirely different story...
...and inflation expectations are a disaster...
...and as for the economy, well...
So, there you go. But as long as the rich are doing well, we suppose this is fine.
Of course then again, what's about to happen here is that Japan is going to run out of monetizable government bonds. Once that happens, the BoJ will need to consider two alternatives: 1) buying pretty much the entirety of the Japanese ETF market, and/or 2) resorting to direct deficit financing (i.e. "helicopter money").
While neither of those options will fix the country's demographic problem or do anything to change the fact that Tokyo is headed for "failed state" status by 2018, there may still be some more room for the rich to get a little richer vis-a-vis the peasantry so, mission accomplished?
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I'd like to see how deep the BoJ is into U.S. and European equity ETF's.
The SNB is asses and ankles deep, so it's a safe assumption that they're all in cohorts.
I keep having nightmares about Tyler explaining directional flows/ liquidity in bond and ETF markets.
How hedge funds , banks, private equity, bond clearing houses, ect... are securing lines of credit, to offset outflows.
Japan needs to tell the corrupt USSA-Obama , et el , ignorant facist fag westerner to fuck the hell off and until they do they are completly fucked. Cut the USSA lose and hope remains.
Japan is taking up the UST slack from China. Japan is in a slow motion death spiral.
Japanese assets are pegged to the $USD.
Japanese monetary policy is undirectional>>>> The BoJ prints and monetizes debt, and buys $usd denominated debt until the house of cards falls, or the game changes.
The new game is Lincoln Logs. AKA NIRP.
They have tried that but they were not allowed. Then Abenomics came in and that was to fix everything. Many media still report how wonderful Abenomics work - they only look at the sugar hit effect which lasts about 2/3 years. Creating more inequality was their goal from the beginning, so yes, Abenomics did the magic. Alll economies where job security has been abolished are been limping.
Why do they like to create more inequality, i.e. very rich and very poor people? The politicians can then do what they like; the poor are too busy keeping their heads above water and the rich are busy with getting richer. The quarrelsome middle class which always wants improvements and spends their time bothering the politicians, needed to be eliminated and they have widely succeeded. The side effect of eliminating the middle class is though, that less money is spent. The poor don't have much and the rich rather pile it up than investing in jobs.
That's the whole plan of Central Banks serving as lackeys for banks/corporations/insurers, isn't it?
Like I give a fuck anymore, the last thing a drowning man needs is a glass of water. I vote we have more titty stories with pictures.
Fuck yeah. ( o ) Y ( o )
The Japanese can take as much pain as any people alive past or present but when they fight back look the fuck out.
The best part of "Just the tip" monetary/political policy is the end game of buckin-bronco full insertion. I'm sure Abe will like it when the collective squeals a little. Same applies to the gen pops of other 'accommodative' submerging/developed markets.
Machine guns. It's the only way now.
U CIA or FBI bait ?
ATF. Only the ATF cares about "machine guns."
And the BOJ hyper buying of the stock market is coming to end...they are running out of money. It is a going to be a spectacular implosion when that barrel starts running down hill
That is akin to saying the "Bank" in the game of Monopoly would lose against the 'players'. Though I certainly would like to see a bit of 'poetic justice' in the way of a surprise/quick Weimar-like reaction to their currency. So quick that the 'others' can't keep up (in terms of currency deval).. It doesn't really have to be JPY.. it could be any of them.. It'd be nice to see 'consequences' are more than just a myth
maybe they should try defending the Yen rather than letting the US/TBTFs stomp all over it to prop up the futures indexes
Abe is a team player, working to re-establish Japan’s former glory and also transfer as much money as possible from working people to the financial elite. Unfortunately, his “3 arrows” have been a bust and the Elephant in the Room- the $ trillion disaster at the Fukushima Daiichi Nuclear Power plants has not been resolved. Conclusion- the future for Japan is bleak.
Subservient Japanese will go along with it until the yen collapses.
Thank the Federal Reserve for that.
When they were concocting sheeple, Japs broke the mold.
The rich are in liquid $ denominated assets so BOJ has to be on auto pilot in just slowing the pace in the evisceration of the middle class. A fake social cohesion that is driven by the demographics. (Old People have no energies for street protests, etc).
japan is ruled by cia
america gave them money and wealth, now they will crash japan into the trash bin
abe and kuroda and their straff is all hand in hand with cia
all japanese economy is based on unicorn from beginning
japan is a strategic military important base for usa's world domination gmes
abenomics is not a fail - it was created to crash japans actulal society creating an superrich oligarch elite and everyone else is without money
future goals are mass immigration and maybe islamization (maybe from pakistan indonesia uygur etc etc)