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Thread: Abenomics

  1. #1
    Master Member vinayakm's Avatar

    Cool Abenomics !!!

    Here is the Japan thread that I talked about.

    Shinzo Abe is going to be around for some time. His inflationary measures and strategies to boost the fledgling Japanese economy have given binary option traders some predictable binary trading picks on the Nikkei and JPY related currency pairs.

    In a nutshell, Abenomics is set of policy measures set up to resolve Japan's macroeconomic problems. There is obviously monetary and fiscal policy involved, along with economic growth strategies to support private investment. Taking a look at policies specifically, there is the inflation target at a 2% annual rate, yen devaluation, negative interest rates, radical QE and more public investment with the buying of bonds by the Bank of Japan (BOJ).

    Is Abenomics a short-term fix? Does Japan have a demographics problem? What's different between Abenomics and the US QE program? It is all here.

  2. #2
    Legendry Member Michael Hodges's Avatar
    the plan put in place by Abe and Kuroda has an event horizon many years out....this trade is only just begun in my opinion, I am looking for the yen and the nikkei to continue in the direction we have seen over the past 8 months.

  3. #3
    Master Member vinayakm's Avatar
    Japan equities drop as USD dips below ¥100 once again

    Japanese equities fell today USD/JPY had another rough day and actually dropped below the 100-yen level. Additionally, even US stocks finished mixed, with technology and industrial shares losing ground.

    Asian stocks actually rose after Bernanke's remarks and the drop came ahead of the Japanese central bank's monetary-policy decision and press conference scheduled for later in the day, where the Bank of Japan is expected to curb its stimulus program.

    The Nikkei fell 0.6% to 14,325.77 and the broader Topix shed 0.7% to 1,186.30. Shares of Toshiba Corp slid 1.7%, Nikon Corp. was down 2.7% and construction-equipment maker Komatsu Ltd. lost1.5%.

  4. #4
    Master Member vinayakm's Avatar
    How Will the USD/JPY fare this week: A look at the U.S. economy

    Last week, the markets were supposed to be rather somber as they awaited the word from central bankers in the U.S. and across the pond in Britain and continental Europe. On the other hand, these central bankers were rather hesitant wanted to see how the economic data would transpire before settling down on their hard decisions.

    Economists hold the view that the U.S. economy will get back to what is considered normal fairly soon and Bernanke's calls for tapering will be justified. However, the Fed Chairman did not note any time frame as such for scaling down monthly U.S. bond purchases and other paper in his recent press conference.

  5. #5
    Master Member vinayakm's Avatar
    Japan National Debt: Now at a Quadrillion Yen

    Japan growth slows in second quarter, adds to sales tax uncertainty. Japan's economy grew at a slower-than-expected rate in the second quarter, offering ammunition to those seeking to delay a scheduled sales tax increase even as government debt has risen past 1,000 trillion yen ($10.4 trillion).

    Capital expenditure unexpectedly fell for a sixth straight quarter, a sign that companies are yet to boost spending despite the feel-good mood generated by Prime Minister Shinzo Abe's reflationary policies over the first half of 2013.

    The world's third-largest economy grew an annualized 2.6 percent in April-June, a third straight quarter of expansion but below both a forecast of 3.6 percent growth and a downwardly revised 3.8 percent rate in the first quarter.

  6. #6
    Legendry Member Michael Hodges's Avatar
    Abe and Kuroda are going to have to do something to bolster sentiment. The Japanese are fearful the reform efforts are not going to work or will not last long enough. It may be time for Abe to load up the bazooka again and shoot a pile more yen into the picture. I am still bullish long term on teh USD/JPY, today saw a nice bounce up from support, more than 1 handle.

  7. #7
    Master Member vinayakm's Avatar
    Japanese Macro Data

    It had been a very quiet week in the Land of the Rising Sun last week. It is more like a calm before the storm indeed. This week is going to be rather data heavy for Japan.
    If we can manage the risk and trade binary options with the right guidance and a directional basis, there is plenty of money to be made trading news reports: the Japanese retail sales out at 7:50pm ET on Wednesday should have a big influence.

    Then there is Thursday that is going to be big for the Nikkei and the Japanese Yen with household spending, CPI, the unemployment rate and industrial production being released in the space of 20 minutes. Pips are going to explode. What a great time to be a binary options trader.

    It appears as the housing market has strengthened with real estate stocks propelling the market momentum. Property developers have been earning more cash and home buyers have caused an increase in housing demand as they lock in their purchases ahead of April's consumption tax-hike.

    Tech majors have also contributed a fair share.

    Japanese Stocks up early on Monday
    Abenomics has continued to be good for the Nikkei. The Tankan data release on Saturday is much awaited as it is seen as the most complete reading on the performance of the Japanese economy.

    The is quarterly survey by the Bank of Japan shows investors how individual parts of the economy are performing (small and large manufacturing entities). Investors can get a good idea of how investments will be in the future. A good Tankan reading will provide a boost for the JPY and the Nikkei.

    Binary option traders can get some insights into the employment and economy sentiment that prevails in the Japanese corporate world. Anyway, Thursday's CPI should be a good news report to trade binary options on Japan. Binary option traders will note that higher CPI values cause the Bank of Japan to raise interest rates. Then foreign investors will pour money into the country as more Yen gets bought, putting a lot upward pressure on the Japanese currency.

  8. #8
    Master Member vinayakm's Avatar
    Japan panel backs sales tax hike coupled with stimulus

    Japan's government gained backing for a controversial decision to increase the 2014 national sales tax after a special advisory panel stated that this would not limit the economic recovery or business confidence. So it can be coupled with a further stimulus.

    Abenomics has actually seen to it that the Japanese economy is stable and so it makes to increase the tax as previously planned. The consumption tax is planned to be raised to 8% from its current level of 5% in April. It seems like the risks of not raising the tax overshadow the risks that come with raising the tax.

    But it seems that the move seems to go against Premier Shinzo Abe's plan to end 15 years of deflation. He has been very assertive about revitalizing the economy and this could slow consumption.

    Anyway, Japan's economy has official started growing after being in a recession even in much of 2012. Macro data for 2013 has been quite encouraging with monetary easing from the Bank of Japan accelerating growth.

  9. #9
    Master Member vinayakm's Avatar
    Japan: Massive Debt Problem

    Japanese debt has ballooned to¥1008.6 trillion or US$10.46 trillion. This is a considerable amount given that it is more than the economies of Germany, the UK and France combined.

    The USD/JPY could go over the 100 level again by the end of next week and possibly test the 103 level in the coming weeks.

    The large Japanese companies are increasingly moving their money away from Japanese bonds to higher yielding returns in the U.S. and Australia. Investors in Japan have started to realise that any money made in the upward trajectory of the Nikkei 225 is being negated by the potential currency loss.

  10. #10
    Veteran Member hchandra's Avatar
    Quote Originally Posted by vinayakm View Post
    Japan: Massive Debt Problem

    Japanese debt has ballooned to¥1008.6 trillion or US$10.46 trillion. This is a considerable amount given that it is more than the economies of Germany, the UK and France combined.

    The USD/JPY could go over the 100 level again by the end of next week and possibly test the 103 level in the coming weeks.

    The large Japanese companies are increasingly moving their money away from Japanese bonds to higher yielding returns in the U.S. and Australia. Investors in Japan have started to realise that any money made in the upward trajectory of the Nikkei 225 is being negated by the potential currency loss.
    Seems big dillema for Japan, although the value of index / stock increasing, they might experience loss because of currency weakness.
    Well, nothing to stop the bull yet, Kuroda will speak this Thursday and the speech may spark further weakness in Yen.

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