Forbes (February 9)
“Economists are struggling to put China’s epic $7 trillion stock crash in perspective. The best size and scope may be that, since 2021, the market has lost the combined gross domestic product of Japan and France.” But that’s not even the worst news out of China. Beijing is now “on the lookout for those disseminating negative views on China’s economic and market prospects. This chilling warning not to ‘denigrate China’s economy’ via ‘false narratives’ is Mao Zedong, not Adam Smith. And it raises troubling questions as China’s influence soars.”
Tags: $7 trillion, Adam Smith, Chilling warning, China, Denigrate, Economists, False narratives, France Disseminating, GDP, Influence, Japan, Mao Zedong, Negative views, Prospects, Stock crash, Troubling
International Banker (December 18)
If Japan’s Financial Services Agency and the nation’s “asset-management industry work together to establish ‘customer-oriented business operations’, they may succeed in gaining the trust of retail investors, and the financial assets of Japanese households may finally show a visible shift from cash and deposits to securities.” Two decades of failed efforts starting with the Big Bang financial reform suggest “it will take much effort to gain the trust of retail investors, some of whom have experienced disappointing returns in the past. Unless the Japanese financial industry works harder than ever for customers’ interests, the goal of ‘savings to investments’ will turn out to be elusive once again.”
Tags: Asset-management industry, Big bang, Customer-oriented, Disappointing, Elusive, Failed, Financial assets, Financial Reform, FSA, Households, Investments, Japan, Retail investors, Securities, Trust
Investment Week (December 7)
“Japanese equities are comfortably multi-asset teams’ most favoured asset class according to our sentiment indicator. Its economy continues to be viewed as being relatively sheltered from the effects of interest rate rises seen elsewhere.”
Tags: Asset class, Economy, Equities, Interest rate, Japan, Most favoured, Multi-asset teams, Rises, Sentiment indicator, Sheltered
Financial Times (November 15)
“One of Asia’s sleepiest investment sectors has outperformed tech stocks.” Share prices have soared at Japanese banks and their earnings now “confirm the prescience of that rally…. Earnings at Japan’s five biggest banking groups rose 56 per cent to a record of about ¥2tn ($13bn).” Higher spreads and buybacks are part of the equation, “but the biggest driver of the rally has been rising hopes that the central bank may end its ultra-easy monetary policy soon.”
Tags: Asia, Banks, BOJ, Buybacks, Earnings, Investment, Japan, Outperformed, Rally, Share prices, Soared, Spreads, Tech stocks
Bloomberg (October 31)
“Japan’s central bank insists it still wants to cap long-term market rates,” but their “actions suggest officials are losing the stomach for it.” Kazuo Ueda is dismantling “the cumbersome legacy of his predecessor… more rapidly” than expected “when he took the helm of the Bank of Japan.” Nevertheless, BOJ officials are insisting that the “policy is only being tweaked.” This threatens “the credibility of its communications” as “key parts of the BOJ’s entire approach to setting borrowing costs are being removed or watered down.”
Tags: BOJ, Cap, Central bank, Credibility, Cumbersome, Japan, Legacy, Long term, Market rates, Officials, Predecessor, Threatens, Ueda
Financial Times (October 25)
“Japan’s biggest automotive trade show acts as a gauge of how hard the country’s once unstoppable carmakers are ready to fight for survival. Increasingly it looks like an industry waiting for a miracle. The trillion-dollar question is whether solid-state batteries — a technology that promises greater range and safety than lithium-ion ones, and which Toyota has indicated it is near to mass producing — can be that miracle.”
Tags: Automotive, Carmakers, Industry, Japan, Lithium-ion, Miracle, Range, Safety, Solid-state batteries, Survival, Toyota, Trade show, Unstoppable
Financial Times (October 5)
“Japan’s demographics — for all the socio-economic hand-wringing they cause — are now arguably the biggest ‘buy’ signal the country has sent for decades…. In several critical areas, Japan’s demographics are aligned to work strongly in favour of companies and investors.” One of these stems from “from labour shortages and the profound psychological difference they make to corporations’ ability to restructure.” This will enable corporations to “divest everything non-core and focus instead on what they are best at.”
Tags: Buy signal, Companies, Demographics, Divest, Hand-wringing, Investors, Japan, Labour shortages, Non-core, Psychological, Restructure, Socio-economic
South China Morning Post (September 26)
“Foreign investors are returning to Japan’s property market in their droves, attracted by the weak yen and an economic recovery fuelled by the buoyant logistics and hospitality sectors, according to a new report.” Singapore investors are leading the charge with property investments totaling “nearly US$3 billion spent from January to September, eclipsing the around US$2.5 billion from the US, and some US$1 billion from Canada.” Japan’s “mild inflation and favourable financing costs” are also adding to the attraction.
Tags: $3 billion, Canada, Economic recovery, Financing, Foreign investors, Hospitality, Inflation, Japan, Logistics, Property market, Singapore, U.S., Weak yen
Wall Street Journal (September 24)
“America’s billionaires love Japanese stocks. Why don’t the Japanese?” Despite enthusiasm from overseas, “there are few signs its estimated 125 million residents share in the excitement. Burned by dismal returns since the bursting of Japan’s asset bubble in the late 1980s and early 1990s, generations of families here have stashed most of their money in low-yielding savings accounts rather than trying to increase their wealth through the stock market.”
Tags: 1980s, 1990s, Asset bubble, Billionaires, Dismal returns, Enthusiasm, Excitement, Japan, Low-yielding, Money, Overseas, Residents, Savings accounts, Stashed, Stock market, Stocks, U.S.
Bloomberg (September 21)
“The value of the yen has slumped to the lowest on record, as measured against a broad basket of its peers and adjusted for inflation,” the Bank for International Settlements found based on data from 1970 onward. This serves to “underscore the pressure on the Bank of Japan to normalize its ultra-easy monetary regime, which continues to weigh down the nation’s interest rates and weaken the currency. The drop in the so-called real effective exchange rate means Japanese have to pay more for imported goods and services at a time when wage growth is failing to compensate for inflation.”
Tags: BIS, BOJ, Currency, Imports, Inflation adjusted, Interest rates, Japan, Normalize, Pressure, Real effective exchange rate, Record, Slumped, Ultra-easy, Wage growth, Yen
