Tag Archives: japan

Is Japan’s Inflation Failing?

By Biiwii

We begin with NFTRH.com’s post from July 16 noting the message I got from a former associate (from my previous life as a manufacturer)…

“Just an update for you, some disturbing news has leaked out this week.  Machine tool builders have put out blow out [lists] to all sales persons in the USA, not sure if world wide.  Mori Seiki list has 600 to 700 machines on it WOW!!! never have i heard of such a huge list by any one Builder.  Not sure what they see coming but it can’t be good.”

My comment from that post:  “Mori is a big builder and when the big builders start blowing out it goes right down the food chain.”

Concurrent with this NFTRH had been watching Machine Tool builder Fanuc ever since projecting its upside in Q4 2014 (due to BoJ’s Yen eroding monetary policy that would help exporters).  We watched Fanuc in particular because it has been getting hyped (on Robotics) by certain suits (i.e. financial types) who have probably never set foot on a manufacturing floor in their lives, let alone operated a Machine Tool.  But also, I know first hand that Fanuc is a quality builder and I like a good and progressive company as much as the next guy.

On July 28 we noted the devil in the details of Fanuc’s financial results and downward-revised forecast.

Continue reading Is Japan’s Inflation Failing?

Around the Web

By Biiwii

Market Analysis & News From Around the Tubes…

  • Banks, Gold & Yields  –NFTRH.com [biiwii comment: so i start a post simply to update the mostly inverse situation in bkx and gold, and i get into a whole ball of wax before it’s done.  check it out.]


Is Japan Zimbabwe?

By Axel Merk

Is Japan Zimbabwe? How preposterous: Japan is an advanced economy that cannot possibly suffer the same fate as Zimbabwe. Right? Or could Japan get hyperinflation? Below I explain why Japan, and with it investors’ portfolios, might be at risk.

The other day, when I was on a panel discussing unsustainable deficits in the U.S., Eurozone and Japan, the risk of inflation and Zimbabwe style hyperinflation came up. When asked about the difference about Japan and Zimbabwe, I quipped that there isn’t any. My co-panelists were all over me, arguing Japan is different. Notably that Japan could not possibly go broke because, unlike Zimbabwe, it’s an advanced economy. The argument being that Japan produces goods the world wants.

Continue reading Is Japan Zimbabwe?

Abenomics: From Faith to Failure

Guest Post by EWI

Why the biggest monetary stimulus effort in the world did NOT stop deflation in its tracks

When Shinzo Abe became the Prime Minister of Japan in December 2012, he was regarded with the kind of reverence that politicians dream about. He was featured in a hit pop song (“Abeno Mix”), hailed as a “samurai warrior,” and featured on the May 2013 The Economist cover as none other than Superman.

But in the two short years since, Abe as Superman has been struck down by the superpower-zapping force of economic kryptonite. On November 17, government reports confirmed that Japan’s brief respite from a 20-year long entrenched deflation was over as the nation’s 2nd & 3rd quarter GDP shrank 7.2% and 1.6% respectively.

Continue reading Abenomics: From Faith to Failure

Why Japan’s Money Printing Madness Matters

Guest Post by David Stockman via Stealthflation

This is getting hard to believe. The announcement that Japan has plunged into a triple dip recession should have been lights out for Abenomics. But, no, its madman prime minister has now called a snap election to enlist more public support for his campaign to destroy what remains of Japan’s economy.

And what’s worse, he’s not likely to be stopped by the electorate or even the leadership of Japan Inc, which presumably should know better. Here’s what Japan leading brokerage had to say about the “unexpected” 1.6% drop in Q3 GDP—- compared to the consensus expectation of a 2.2% gain and after the upward revised shrinkage of 7.3% in Q2.

Continue reading Why Japan’s Money Printing Madness Matters

Around the Web


Japan Breaks Two Symmetrical Triangles

NFTRH has been noting for quite some time the mirrored Symmetrical Triangles in Japan’s stock market and its currency.  We noted that Sym-Tri’s being continuation patterns, Nikkei should break up and the Yen should break down if the Tri’s hold to form… 


The Fed’s Great Adventure in Inflation

In the current policy and media stoked market environment, anything is possible.  It’s  the wonderful, magical world of hands-on policy making.  5 years after the financial crisis, but still not enjoying a ramping economy like the good old (and long gone) days of the last great secular bull market (RIP 2000)?  Just sit back, relax and let the man in charge control the image.

Continue reading The Fed’s Great Adventure in Inflation

FOMC Minutes… Head for the Hills!!!

While the MSM instigates reasons why we should give a damn about what people who have little control over the T bond market were thinking at the last meeting, why don’t we just tune it all out and manage the markets instead?

tyx, etc

The top panel shows the 30 year yield marching toward the traditional limiter AKA the 100 month EMA.  The pattern measures to 4.5% or so, so there could be a spike above and a hell of a lot of hysteria at some point.  That’s the collective markets; 98% hype, hysterics and emotion and 2% rational management.  Either the 30 year yield is going to do something it has not done in decades (break and hold above the EMA 100) or it is not.  Simple.

The relationship between long term bonds (30) and short term bonds (2) in the middle panel is currently negatively diverging gold as the ratio has dropped this month.  Again, we wonder is gold (bottom panel) leading the curve this month or should gold bugs take caution?  I think gold is leading the curve, but it bears watching.  The relationship became distorted in second half, 2012.

As for gold, it probably bottomed at the end of June.  That is because the sold out condition of the sector (read: Paulson puking GLD, hedge fund net short positions, India’s antagonism toward its would-be gold buyer citizens, etc. etc. etc.) was simply historic.

Really, just dialing down all the noise of the last 2 years it was a grand and climactic panic IN to gold in 2011 by the global public in the face of the Euro’s supposed Armageddon.  Everyone had bought and then it was time for the bleeding out of this emotional money.

The bleeding went on longer than I originally thought it would, but that is why we do ongoing work to interpret things every step of the way.  Hey, no harm no foul.  A little patience and ongoing perspective and now we have what appears to be a purified asset class, free of unhealthy sponsorship.

Back to the chart’s top panel.  China is a net seller of T bonds.  Japan is a net seller of T bonds.


As we have been noting every step of the way T bond yields are a function of supply and demand.  The global system endured a solid decade of net inflows of global funds into the T bond market.  Now it appears the tide may be going out.  Hence, interest rates all along the curve – save for the officially manipulated ZIRP on the Fed Funds – are going up.

It is all normal to free market participants; just another phase.  It is only abnormal if you buy in to the idea that the Fed is in control and can remotely operate the financial markets indefinitely; if you buy in to the idea that the Fed decides when the cycles are to change.

If you look at it a certain way, it’ll tickle your funny bone as you listen to Huey, Dooey and Louie jawbone ‘Taper’ in the media or as you review what a bunch of bureaucratic clerks had to ruminate about at the last FOMC meeting at 2 PM US Eastern today.

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