Japan 07 (Oct 23 - Dec 26)

[behappyalways]

Japan Posts Record Population Drop, Shrinking For 14th Year, As Demographic Crisis Deepens
https://www.zerohedge.com/economics/jap ... is-deepens

[behappyalways]

The largest Japanese public companies
https://x.com/Mayhem4Markets/status/1927174884729209020


It's incredible just how much the Japanese bond market implosion has impacted life insurers. We're talking about 8 trillion of unrealized losses so far. Yes, this is a crisis and it's a big reason why the government and central bank of Japan will step in to calm down yields.
https://x.com/Mayhem4Markets/status/1927386493745590723

[behappyalways]

Wow. How the times have changed.
https://x.com/Mayhem4Markets/status/1927756311636172926

[behappyalways]

What a dash for the exits! Japanese funds see biggest weekly outflow ever!
https://x.com/Mayhem4Markets/status/1929174062154043564

[winston]

Japan’s trade strategy tested as Trump pushes for quick deals

By Yoshiaki Nohara, Sakura Murakami & Alastair Gale

Not wanting to risk a bad deal with a national vote looming on July 20.

We expect a package to span various fields and become quite extensive, so there are still points where the two sides are not on the same page.

Ishiba’s team is pushing to reduce a steep 25% tariff on Japanese cars and lower the planned across-the-board duties from 24% set to take effect on July 9.

Tokyo is also offering cooperation on shipbuilding and increased spending on US semiconductors and liquefied natural gas as sweeteners.

Japan’s auto industry accounts for nearly 10% of the country’s gross domestic product and employs around 8% of the workforce.

The ruling Liberal Democratic Party has long relied on support from the farming sector to retain seats in rural areas.

Source: Bloomberg

https://theedgemalaysia.com/node/761026

[behappyalways]

Japan real wages: devastation
https://x.com/zerohedge/status/1942227082848653420

[winston]

US Treasury's Bessent says good tariff deal with Japan still possible

A mutually beneficial US-Japan tariff agreement is still possible, Treasury Secretary Scott Bessent said on Friday after meeting Japanese Prime Minister Shigeru Ishiba in Tokyo.

"A good deal is more important than a rushed deal, and a mutually beneficial trade agreement between the United States and Japan remains within the realm of possibility," Bessent said on social media.

Speaking to reporters after the meeting, Ishiba said he asked Bessent to continue "active talks" with his top tariff negotiator Ryosei Akazawa.

Bessent left Ishiba's office without speaking to reporters.

Bessent's visit comes at a delicate moment for Japan, as its fragile minority government is poised for another setback in an upper house vote on Sunday, an outcome that could complicate the tariff talks with the United States.

Source: REUTERS

https://www.thestandard.com.hk/market/article/307041/

[winston]

How could Japan's election affect economic policy?

LOOMING POLITICAL UNCERTAINTY

Stoking fears of an increase in debt. Japan's debt burden is the highest in the developed world at about 250% of GDP.

[/b]Yields may rise further if the chance of big spending or a sales tax cut increases.

WOULD JAPAN HAVE A NEW PRIME MINISTER?


WOULD JAPAN SEE BIGGER SPENDING?

Regardless of the election outcome, Japan will increase spending as Ishiba has pledged to offer cash payouts to households to ease the cost of living. The estimated 3.5 trillion yen ($23.6 billion) in payouts will be funded by tax revenues.


HOW LIKELY IS A CUT TO JAPAN'S SALES TAX RATE?

Japan's sales tax rate is set at 10%, except for food items at 8%.
Excluding proceeds from debt issuance, the sales tax is Japan's biggest source of revenue. In fiscal 2025, it collected 25 trillion yen, or 21.6% of total budget. Analysts say halving the tax rate would cut revenues by over 10 trillion yen.


WHAT WOULD BE JAPAN'S WORST-CASE SCENARIO?

A worst-case scenario is a credit rating downgrade on Japan's sovereign debt, which could trigger a triple selling of bonds, yen and Japanese stocks - and boost the cost of dollar funding for Japanese banks.


HOW WOULD THE ELECTION OUTCOME AFFECT BOJ POLICY?

If the clout of other smaller opposition parties increases, the BOJ could come under pressure to go slow in rate hikes.

Source: Reuters

https://www.thestandard.com.hk/world-ne ... le/306887/

[winston]

by behappyalways:-

Political turmoil cools bond market, 40-year Japanese bond yield hits record high!
Japanese yen and Japanese bonds weaken, but Japanese stocks once surged to 42,000

政治動盪債市冷 40年期日債殖利率創高! 日圓.日債走弱 日股卻一度衝上4萬2｜非凡財經新聞｜20250724

https://m.youtube.com/watch?v=1NpO7GUt26E

[winston]

Japan’s soaring stocks trigger memories of 2024 market crash

By Momoka Yokoyama

“This time around, it’s not the yen driving the rally but I’m definitely keeping a close eye on the levels we saw during last summer.”

Japanese stocks crashed last August in the wake of the Bank of Japan’s unexpected interest rate hike, coupled with Governor Kazuo Ueda’s hawkish messaging and economic concerns in the US.

The Topix’s 14-day relative-strength-index was about 79 on Thursday.

The Topix index traded more than 5% above its 25-day moving average on Thursday, a level has traditionally preceded a correction.

The rally in the Topix index hasn’t been accompanied by rising turnover, similar to last July’s pattern, suggesting there may be a lack of conviction in the market.

As Japan enters peak earnings season, some companies may maintain a cautious outlook as they gauge the impact of tariffs.

The Topix index’s forward price-to-earnings ratio is now close to the levels just before last August’s decline, at 15.7 times versus 15.87 last July, but still cheap in comparison to the US.

Source: Bloomberg

https://theedgemalaysia.com/node/764018