Japan 2023 is Risk On While Western World Is RIsk Off
Updated
Japan might offer some interesting plays for risk assets. Getting long in some bullish Japanese stocks might be interesting. Especially if those stocks can catch some other bullish trend unrelated to .
What's going on in Japan? Short answer is Central Bank Monetary stimulus... need i say more?
..But wait.... Didn't they recently raise rates to the highest level seen in over a decade in December 2022?
Yes, but , Raising the rate cap (to 0.5% which might as well still be 0) is only half.. no a third of the story.
BOJ stated in 2/02/2023 statement that they raised the rate cap to better facilitate the continuation of monetary easing AND they will offset the interest rate increase by ramping up the purchase of government bonds.
AKA.. the Japan money printer is alive and well and they are hoping investment returns to the Yen and in turn yen assets.
Land of the Rising Stocks.
What's going on in Japan? Short answer is Central Bank Monetary stimulus... need i say more?
..But wait.... Didn't they recently raise rates to the highest level seen in over a decade in December 2022?
Yes, but , Raising the rate cap (to 0.5% which might as well still be 0) is only half.. no a third of the story.
BOJ stated in 2/02/2023 statement that they raised the rate cap to better facilitate the continuation of monetary easing AND they will offset the interest rate increase by ramping up the purchase of government bonds.
AKA.. the Japan money printer is alive and well and they are hoping investment returns to the Yen and in turn yen assets.
Land of the Rising Stocks.
Note
Well... this went well.
Japan ponzi went up only for about 16 months from the time they started doing massive monetary injection in Jan 2023.
The liquidity cycle started earlier than most of the other countries (because their economic situation was much more dire)
but this may be a hint at what can happen in the end of 2025 - 2026 as the US liquidity cycle comes to an end. the US M2 just started up ticking in recent months starting a rate cut cycle with liquidity injections likely incoming
lets see what happens
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