Dec

8

Peter Pinkhaven writes: 

I am 20 years now removed from Fixed Income but I read the effect of BOJ buying has led to days where there have been no trades in the benchmark JGB.  Also for 30 years as the “smart“ crowd bet against the JGB due to debt to GDP climbing to 100 then 200pct & zero rates in return - shorting JGBs became known as the Widowmaker.

I thought the expected endgame in Japan was for the BOJ to swap the equity holdings in the Topix for the JGBs the State/Postal Pension Fund owns.  

As we look at the Japanification of all OECD economies - Russell Napier has a fascinating view where Russell has flipped from being a perpetual deflationist to saying the OECD will be at 4pct inflation in 12 months time - not because of QE but because of the guaranteeing of loans which injects real non recourse cash into the economies and grows bank reserves (risk free lending to the banks)

https://ttmygh.podbean.com/e/teg_0005/

Stefan Jovanovich  writes: 

"Given that it is expected to take more time to achieve the price stability target, due in part to the impact of COVID-19, I think it will become even more important for monetary easing measures to be sustainable and flexible. Given that monetary easing is expected to be further prolonged due in part to the impact of COVID-19, the Bank should look for additional ways to enhance the sustainability and flexibility of the policy measures so that it will not face difficulty in conducting ETF and J REIT purchases when an appropriate lowering of risk premia of asset prices is absolutely necessary." (Speech to local leaders in Fukushima, via webcast, 3 December) 

Sitting in the bleachers along with all the cardboard pictures of people, even I have noticed that concession sales are down.  You can't buy a beer because there is nobody around to sell you one.  If the national Treasury buys the stock of the food service company that has the concession, will that raise the price of the beer I can't buy?


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